1951-02-08

[Stage Direction]
Report of the proceedings of the commissioners of internal economy for 1950.-Mr. Speaker.


Hon. Brooke Claxion (Minister of National Defence):: Mr. Speaker, as hon. members know, Canada supplied the equipment, largely armament and ammunition, for a division to The Netherlands, and this was delivered last December.
Monday night in the house I stated that, arrangements having been completed for replacement by equipment of U.S. pattern, we had indicated to the council deputies under the North Atlantic treaty our willingness to supply the equipment for another division, and we asked advice as to its disposition.
Word was received today that the standing group had recommended that this equipment be delivered to Belgium. I am glad to report that this action was approved by the cabinet this afternoon.
As soon as shipping instructions are received, the equipment will be shipped from the ordnance depot at Longue Pointe, Montreal, where it is ready and in good condition.
By this action we will help to strengthen 'the defences of freedom in western Europe, promote standardization on each side of the Atlantic, and strengthen the ties which already exist between the forces and peoples of Belgium and our own country.


Mr. Pearkes:: Mr. Speaker, arising out of the statement the minister has just made, may I ask if he can indicate when the equipment which is being sent to Belgium will be replaced-I presume from some other country-for Canadian purposes?


Brooke Claxton: Arrangements have already been made for the replacement of the equipment for the first division, which was shipped to The Netherlands, by purchases from the
United States. Delivery of that equipment will be commenced at an early day and completed in' a few months. We expect with confidence that that will be followed by similar arrangements to be made with the United States for replacements. Whether or not we shall offer equipment for a third division until the replacement of the equipment for the first division has been completed, is a matter still under consideration.


Brooke Claxton: With the permission of the house, Mr. Speaker, I should like to revert to motions.


The Acting Speaker (Mr. Beaudoin):: Has
the minister leave of the house to revert to motions?


Some hon. Members:: Agreed.


Brooke Claxton: I should like to give the
house the text of a telegram received from our ambassador in Brussels this afternoon. In this telegram he states that Colonel De Greefs said:
On recommendation of the standing group of the North Atlantic treaty organization the Canadian government has decided to offer Belgium the armament of an infantry division. His Excellency Lieutenant General Maurice Pope, ambassador of Canada, has today informed foreign affairs minister Paul Van Zeeland of this decision. Belgium is glad to accept this offer and sees in it a new expression of the active sympathy Canada has always expressed towards Belgium.



DISTRICT COURTS, NEWFOUNDLAND    INQUIRY AS TO APPOINTMENTS

[Stage Direction]
On the orders of the day:
Mr. W. J. Browne (St. John's Wesf):: Mr. Speaker, I should like to ask a question of the Minister of Justice. As he is aware, provision was made last year for the appointment of five district court judges in Newfoundland. Have any been appointed? If not, how much longer shall we have to wait until they are appointed?
Hon. Sluart S. Garson (Minister of
Justice): The matter to which the hon. member refers is under consideration by the attorney general of Newfoundland and by our department.

Inquiries of the Ministry ROYAL COMMISSIONS



TRANSPORTATION


[Stage Direction]
On the orders of the day:
Mr. P. E. Wright (Melfort):: Mr. Speaker, can the Minister of Transport give the house any information as to when the report of the royal commission on transportation will be ready for tabling?


Hon. Lionel Chevrier (Minister of Transport):: I expect to have the report from the chairman of the royal commission on transportation within the next few days. When I do receive it, some time will be required before it can be printed. As soon as that can be done-possibly within two or three weeks -it will be tabled in the house.



ARTS, LETTERS AND SCIENCES-INQUIRY AS TO PRESENTATION OF REPORT

[Stage Direction]
On the orders of the day:
Mr. Donald M. Fleming (Eglinton):: May I
ask the Prime Minister when the report of the Massey royal commission on arts, letters and sciences will be available?


Right Hon. L. S. St. Laurent (Prime Minister):: The last information I had a few days ago was that the report was being printed under the direction of the commissioners themselves. I promise my hon. friend that as soon as it is available there will be no delay in bringing it to the attention of the house.


Donald Methuen Fleming: May I ask if the government has received this report?


Mr. SI. Laurent:: The government has not yet received it. The chairman of the royal commission suggested that he would not present the report to the government until it had been printed ini a form in which it could be made public.



QUESTION AS TO REINFORCEMENTS FOR CANADIAN FORCES

[Stage Direction]
On the orders of the day:
Mr. Howard C. Green (Vancouver-Quadra):: I should like to ask a question of the Minister of National Defence concerning the Princess Pats. A press dispatch from the forces in Korea as published in the Ottawa Journal of last evening indicates that, when the battalion was informed that there were to be reinforcements of seventy-five other ranks and five officers each month, the battalion was wondering whether or not the move to combat duty would find it under


strength. Apparently the battalion is now under strength. Can the minister make a statement in that regard?


Brooke Claxton: 
Howard Charles Green: Can the minister assure the house that when the Pats go into action they will be at full strength?


Brooke Claxton: I cannot give any such assurance. I cannot think of any unit that has ever gone into action at full strength.


George Randolph Pearkes: Will those reinforcements be drawn from the third battalion of the Princess Patricias, or will they be drawn from' some other unit of that special brigade?


Brooke Claxton: I shall have to look into that. The reports I have with regard to the situation at Fort Lewis are several days old, and I shall have to give my hon. friend an answer later.



QUESTION AS TO FINAL PAYMENT ON FIVE-YEAR POOL

[Stage Direction]
On the orders of the day:
Mr. H. R. Argue (Assiniboia):: I should like to ask the Minister of Trade and Commerce if he will endeavour to have the final payment on the five-year pool made in time to assist farmers in their seeding operation.


Right Hon. C. D. Howe (Minister of Trade and Commerce):: I shall be glad to promise to use my best efforts to that end.



SEARCH AND RESCUE SERVICES


[Stage Direction]
On the orders of the day:
Mr.  W. Chester S. McLure@Queens: I
should like to direct a question to the Minister of Fisheries. Is the responsibility of the search and rescue services on the Atlantic coast that of the Department of Fisheries,

The Address-Mr. Howe
the R.C.M.P. or the R.C.A.F., or do these three organizations act as a unit in providing these services?


Brooke Claxton: Perhaps I could answer that question. These services are carried on jointly but under the direction of the R.C.A.P.



HONG KONG


[Stage Direction]
On the orders of the day:
Mr. G. K. Fraser (Peterborough West):: should like to ask the Secretary of State for External Affairs if the Canadian government, following the action of the United States government in directing its people to leave Hong Kong, has issued a similar order in regard to Canadian people?


Hon. L. B. Pearson (Secretary of State for External Affairs):: No direction of that kind has gone out to Canadians in Hong Kong, nor do I think such a direction would be necessary at the present time.


Mr. Graydon:: Has the minister any information about the number of Canadians in Hong Kong?


Lester Bowles Pearson: I have not, but I think the number would be quite small. I shall be glad to make inquiry as to just how many there are.


Gordon Knapman Fraser: Has the staff of the Department of Citizenship and Immigration at Hong Kong been increased?


Lester Bowles Pearson: My colleague, the Minister of Citizenship and Immigration (Mr. Harris), would be the minister to reply to that question. I shall bring it to his attention.


EXTERNAL AFFAIRS OFFICIALS STILL ON THE MAINLAND
[Stage Direction]
On the orders of the day:
Mr. M. J. Coldwell (Roselown-Biggar):: Can
the Secretary of State for External Affairs indicate whether there are any officials of his department on the mainland of China?


Lester Bowles Pearson: We have officials of the Department of External Affairs still on the mainland. I speak subject to correction, but I understand that our representative who has been in Nanking is on his way home on leave.



SPEECH FROM THE THRONE


[Stage Direction]
The house resumed, from Wednesday, February 7, consideration of the motion of Mr. W. H. McMillan for an address to His Excellency the Governor General in reply to his speech at the opening of the session, and the amendment thereto of Mr. Drew, and the amendment to the amendment of Mr. Herridge.
Clarence Decatur Howe: Mr. Speaker, I have two main purposes in taking part in this debate. The first is to outline the measures that are being taken to clear the way for and to speed up the progress of defence production. The second is to outline the present economic situation and to discuss the impact of defence purchasing upon the Canadian economy.
I should like to join with earlier speakers in congratulating the mover (Mr. McMillan) and the seconder (Mr. Breton) of the address in reply to the speech from the throne. It seemed to me that both speakers made addresses that were in the best traditions of parliamentary procedure; they were very fine efforts indeed.
Since parliament met last autumn, world events have moved swiftly. Canada, with the rest of the free world, has had to revise its schedule of preparedness. The challenge of aggressive communism leaves no choice but to move ahead at once, and quickly, with defence preparations planned on a scale never before contemplated except in time of allout war.
My colleague, the Minister of National Defence (Mr. Claxton), has outlined to you the equipment program of the armed services. Hon. members are aware that the Minister of Trade and Commerce, making use of the agency of the Canadian Commercial Corporation, is responsible for the procurement of that equipment. This is a responsibility that entails a volume of work that is being rapidly accelerated. To illustrate the rate of growth, I may tell you that, during 1950, contracts for military equipment, supplies and construction projects were placed on behalf of national defence to a value of $629 million. This is in addition to approximately $31 million spent on married service quarters and related projects by Central Mortgage and Housing Corporation. It is interesting to observe that, in the first quarter, contracts for defence materials placed totalled $56 million; in the second quarter, $88 million; in the third quarter $132 million and in the fourth quarter, $318 million. The rate of awarding contracts will be higher again in the first quarter of the present year.

The Address-Mr. Howe
This increased volume of purchasing has placed a heavy and growing burden on the staff of Canadian Commercial Corporation. To lighten the burden, all defence construction projects have been turned over to a new crown company, under the same minister, named Defence Construction Limited. This new crown company is successor to Wartime Housing Limited, the functions of which had long since been taken over by Central Mortgage and Housing Corporation, but the charter for which had not been surrendered. An application to the Secretary of State resulted in a change of name from wartime housing to Defence Construction. The new crown company has made an arrangement with Central Mortgage and Housing Corporation by which the organization of Central Mortgage provides engineering and other services as called upon. Central Mortgage has in being a decentralized engineering staff that can hardly be duplicated under present-day conditions, and is thus able to serve Defence Construction Limited in all parts of Canada. My colleague, the Minister of Resources and Development (Mr. Winters), who is charged with responsibility for Central Mortgage, has made this arrangement possible, and in doing so has contributed greatly to the efficiency of defence construction work.
However, further expansion of our defence procurement organization will be necessary. For that purpose, the speech from the throne announces the formation of a new department, to be named Defence Production, the duties of which will parallel those of the former department of munitions and supply. The intention is that this new department will take over from Trade and Commerce the functions having to do with war production that were moved into Trade and Commerce when the munitions and supply department was disbanded.
In anticipation of the new department, men from industry have been invited to head up branches having to do with steel, base metals, chemicals and explosives production, priorities, and finance, and these branches are now functioning within the Department of Trade and Commerce.
To date, it has been possible to place defence contracts without any material expansion of industrial facilities. It is now obvious that growing requirements will make it necessary to expand Canada's present industrial capacity. It is hoped that this expansion can be financed privately. A plan for accelerated depreciation is being worked out, to apply to that type of expansion required for war that will have a greatly diminished peacetime value. In addition, and as a last resort, it may be necessary to provide capital assistance for a few types of

expansion. Where capital assistance is used, the facilities so created will remain the property of His Majesty.
Certain expansion of sources of basic materials is already under way. Our steel industry has in progress a vast expansion program involving new investment of close to $100 million. Canadian production of copper, zinc, lead, nickel, and tungsten is being expanded as rapidly as possible, and an aggressive search is being made for cobalt, antimony, molybdenum and chrome. All these metals are now in short supply. Although Canada is the world's largest producer of aluminum, a vast expansion of this highly-strategic war material is being contemplated. Shortages of raw materials are the greatest handicap under which defence production is labouring, and by furnishing greater quantities of these strategic basic materials, Canada can make an outstanding contribution to north Atlantic defence.
To give the house an idea of the present impact of defence purchasing upon civilian production, I have grouped the contracts already placed under some broad headings, as follows:
million
Aircraft	 $267
Armament, ammunition and military
vehicles	   H6
Shipbuilding	 74
General stores	 41
Electronics and communication	equipment	37
Textiles and clothing	 24
Industrial equipment, scientific, medical
and testing apparatus and	miscellaneous	35
Defence construction	 35
To avoid misunderstanding, it should be noted that defence contracts awarded are not equivalent as to timing to defence spending. Some contracts are speedily fulfilled; others take a year or more to be completed.
Contracts for aircraft comprised 42 per cent of the total of defence contracts awarded last year. This is one of the fields in which Canada is making substantial progress, and a notable contribution to the joint defence effort. A Canadian firm has designed, built and successfully tested the most powerful jet engine yet to be developed in North America, the Orenda; and this engine will shortly be in quantity production. We are producing, in quantity, airframes for the most modern short-range jet fighters. We are getting ready to manufacture a long-range, jet-propelled, all-weather pursuit ship, designed and successfully flight tested in Canada. Quantity production of small aircraft of the Harvard trainer type is being undertaken, in part for Canadian account, and in part to meet United States requirements.
Canadian government contracts Jet for naval shipbuilding include 7 escort vessels, 14 minesweepers, 5 trawlers which will be

used as gate vessels, and an icebreaker. Construction of these vessels is taking place on both coasts and in the great lakes area, and work is being pushed ahead as rapidly as steel and skilled manpower makes this possible.
In the electronics field, Canada is producing a great quantity of radar equipment, some for use in this country and other for transfer to European countries within the North Atlantic treaty organization. Canadian ingenuity has created certain types of electronic and related equipment which, in quality and performance, are not surpassed by similar equipment produced elsewhere. For example, a Canadian-developed portable radio set has proven so satisfactory that large-scale production is being undertaken for use both by our own forces and by those of our allies.
Canadian Arsenals Limited, which operates the government-owned arsenals for producing munitions and military equipment, has been turning out increasing quantities of weapons with its existing facilities. The company is also retooling to produce a variety of small arms, ammunition, artillery and other weapons of the United States type. The first production of United States type munitions by Canadian Arsenals will be available in the near future, and preparations are being made for volume production of a wide variety of both weapons and ammunition.
Anticipating that defence preparations would in due course require control over certain critical materials, parliament at the last session passed the Essential Materials (Defence) Act. In November of 1950, steel was declared an essential material, and two orders have been issued under that authority. A third will be issued this week. The first prohibited the use of steel for certain types of less essential construction, such as theatres, bowling alleys and amusement structures generally. The first order, while different in form, had much the same effect as the prohibition in the United States upon the construction of similar types of buildings. Controls on imports were imposed at the same time to ensure compliance with the order.
The second order established a formal system of priorities for defence orders and defence-supporting projects.
These orders, the voluntary arrangements made by the steel mills to distribute supplies equitably among their established customers, and our various arrangements with the United States, have so far been broadly sufficient from the standpoint of defence production and civilian production. I think it well to add a warning, however, that further orders may
The Address-Mr. Howe soon have to be issued to assure supplies of structural steel for essential construction projects.
I give this warning so that those who contemplate construction projects which do not relate closely to our defence effort should not commit themselves to building operations unless they have the steel and other building materials, or know where they can be obtained. It would be unfortunate for those concerned, and a waste of valuable labour and materials, for projects to be started and then held up indefinitely for lack of some vital material.
One other point about steel is worth noting. The controls that are now in effect, and that may be forthcoming in the near future, are not solely and primarily for the purpose of assuring steel supplies for the fulfilment of defence contracts. In fact, defence contracts by themselves do not require a particularly large proportion of available steel supplies. The impact comes rather from the defencesupporting projects, such as the building of railway cars, locomotives and ore carriers to move essential materials and supplies. While technically not defence orders, these are no less essential at the present time than the production of guns.
Under the Export and Import Permits Act the government has restricted the export of a number of essential materials in order to conserve domestic supplies. It also requires permits for a wide variety of strategic materials and commodities, the export of which might be risky from a security point of view. In this we are co-operating with the United States by including all items which are under export control from that country to all destinations except Canada. United States export controls have never been applied against Canada, and I do not think that there will ever be any reason why they should.
Before leaving this subject of strategic materials, I might refer briefly to stockpiling, and advance production of defence materials. Orders placed for important key materials include substantial supplies of explosives, to ensure that shell and munitions programs will not be delayed after our arsenals are in production of U.S. type of ammunition. Materials for uniforms are being acquired. We have continued a modest but adequate program covering the acquisition of strategic materials which are not readily available in Canada. In the case of synthetic rubber, the government-owned Polymer Corporation has embarked on an important expansion program in Sarnia. This will involve a capital outlay of some $7 million, and should enable the company to raise its current output of

The Address-Mr. Howe between 55,000 and 60,000 tons of synthetic rubber annually to between 70,000 and 75,000 tons, an increase of about twenty-five per cent. Eldorado Mining and Refining Limited is also expanding its facilities for the production of uranium in the Goldfields area in northern Saskatchewan.
The national research council, which made so important a contribution to munitions production in world war II, is preparing to make another similar contribution. Under the direction of the council a new and larger atomic pile is being constructed to produce commercial quantities of plutonium.
Canadian defence production is being worked out in close co-operation with all North Atlantic treaty countries, and particularly with the United States. The decision of the armed forces to standardize on U.S. types of equipment has thrown added importance on our co-operation with that country. Incidentally, I can announce that the United States, the United Kingdom, France and Canada have been constituted a committee of the North Atlantic treaty organization to decide on standard types of weapons that will be recognized as such by all NATO countries.
Hon. members will recall the remarkable and highly successful arrangements which were made to achieve economic co-operation between the United States and Canada during world war II. These arrangements stand as a monument to the farsighted statesmanship of two great men:	President Franklin
Roosevelt and Prime Minister Mackenzie King.	[DOT]
Faced again with a common danger, and joined in a common cause, our two governments, on October 26 of last year, agreed to a statement of principles for economic co-operation. Hon. members are no doubt familiar with the general tenor of that statement, but it is of such historic importance that I think it fitting to read the full text into the record. It is as follows:
Statement of Principles for Economic Co-operation The United States and Canada have achieved a high degree of co-operation in the field of industrial mobilization during and since world war II through the operation of the principles embodied in the Hyde Park agreement of 1941, through the extension of its concepts in the post-war period, and more recently through the work of the joint industrial mobilization planning committee. In the interests of mutual security, and to assist both governments to discharge their obligations under the United Nations charter and the North Atlantic treaty, it is believed that this field of common action should be further extended. It is agreed, therefore, that our two governments shall co-operate in all respects practicable, and to the extent of their respective executive powers, to the end that the economic efforts of the two countries be co-ordinated for the common defence and that 
the production and' resources of both countries be used for the best combined results.
The following principles are established for the purpose of facilitating these objectives:
1.	In order to achieve an optimum production of goods essential for the common defence, the two countries shall develop a co-ordinated program of requirements, production and procurement.
2.	To this end, the two countries shall, as it becomes necessary, institute co-ordinated controls over the distribution of scarce raw materials and supplies.
3.	Such United States and Canadian emergency controls' shall be mutually consistent in their objectives, and shall be so designed and administered as to achieve comparable effects in each country. To the extent possible, there shall be consultation to this end prior to the institution of any system of controls in either country which affects the other.
4.	In order to facilitate essential production, the technical knowledge and productive skills involved in such production within both countries shall, where feasible, be freely exchanged.
5.	Barriers which impede the flow between Canada and the United States of goods essential for the common defence effort should be removed as far as possible.
6.	The two governments, through their appropriate agencies, will consult concerning any financial or foreign exchange problems which may arise as a result of the implementation of this agreement,
I cannot, without trespassing too much upon the patience of hon. members, spend time elaborating upon the practical significance of this statement of principles. Two or three important developments, however, are worth noting.
By mutual arrangement, we are buying substantial quantities of war equipment in the United States, and that country is reciprocating by placing substantial war contracts in Canada. We are informed that the United States authorities have set a program objective for purchases of military equipment and supplies in Canada amounting to $100 million for the fiscal year 1951. The largest order placed to date is one for 3-inch naval guns for Sorel Industries Limited. A number of other substantial orders are now in the discussion stage. These orders are being placed in Canada through the agency of the Canadian Commercial Corporation.
Important arrangements have been made with the United States in the field of allocation of scarce materials, and particularly steel. Each country is extending to the other a similar priority to that extended for its own defence orders. I cannot think of a better example of mutual confidence between two countries.
Canada has been included in United States allocations of steel for essential programs, such as the building of railway cars, ships, locomotives, and for the steel warehouse trade. Other programs which both countries agree to be essential for the mutual defence effort are being studied.

The Address-Mr. Howe
New problems are arising every day in our relations with the United States, and I do not wish to leave the impression that all will be plain sailing because we have agreed upon a statement of principles. There are bound to be differences as to the best way to proceed; in fact, the statement of principles recognizes that there may be differences in approach, even though there is consistency of aim. However, I can report that differences are being resolved by friendly discussion as they arise.
I turn now to another aspect of our general defence planning, the North Atlantic treaty organization. Co-operation for defence production in this field is developing slowly but steadily. The basic principle of NATO production calls for the most efficient producers to contribute as fully as possible to the requirements of member governments. Member governments are also required, before entering into any large-scale production, to confer with the military authorities of NATO, to the end that its products shall be acceptable, from a military viewpoint. NATO is doing everything possible to encourage standardization between allies, in order to facilitate production programs. Canada's decision to standardize on American-type military equipment has made it possible for Canada to make available to Europe British-type equipment which we have been using up to the present. Equipment for one division valued at $57 million has already been supplied to The Netherlands, and further material will be made available as rapidly as arrangements for replacements can be completed.
For Canada, preparedness is a many-sided problem. We are increasing our military establishment and our civil defence. We are supplying arms and equipment to countries that have joined with us under the North Atlantic treaty for common defence. Equally important, but often overlooked, we are endeavouring to build up productive facilities and to increase the supplies of many of the vital raw materials, upon which the whole defence effort of the democratic world depends.
This is a complex undertaking requiring the most careful use of resources. Were we presently involved in all-out war, certain questions of priority would not arise. The emphasis in that event would be upon producing the maximum quantities of arms and equipment, with the productive facilities and the materials immediately available. But we are not now engaged in all-out war and may not be for many years, if ever. It is necessary, therefore, to give due weight to the long pull, to enlarging our capacity to
produce as well as our immediate output, so that if and when world war III does come, Canada will be in a position to make a maximum contribution. Moreover, it may be necessary at short notice to alter the approach and to shift the emphasis.
I could illustrate the problem by many specific instances. It appears most clearly perhaps in the case of strategic minerals and hydroelectric power, which are the very lifeblood of industrial mobilization. For example, how much of the limited supplies of steel should be used to enlarge steel-making capacity? Is it in the interests of the common defence effort to use steel to construct pipe lines for the transmission of oil and gas, or to build new dams and power plants? What will be the impact of early action on the St. Lawrence seaway? There will be other opportunities to discuss questions of this kind, but it is important that the house should appreciate the nature of problems that are now being encountered, and that will be encountered in even greater degree, in the course of the preparedness effort.
Economic aspects of defence preparedness. I will now turn to the economic aspects of the defence program'that has just been outlined. Hon. members will appreciate that we are imposing our defence production program upon an economy that is already operating close to full capacity. To illustrate, I will outline the economic position of Canada during the year 1950.
It is now estimated that the value of all goods and services produced in Canada during 1950 was about $17,700 million, an increase of about eight per cent over 1949. About half the increase was due to volume of output, and the other half to higher prices. If I may venture a prediction-and of course there are always risks in anticipating developments a year ahead-there is reason to expect that the gross national product' will rise to approximately $20 billion in 1951.
The high level of world and domestic demand is reflected1 in our foreign trade. The year 1950 established a new point, in the total volume of exports and imports, of $6,300 million. Canadian exports rose from about $3 billion in 1949 to $3-1 billion in 1950. A substantial rise in exports to the United States more than offset a general decline in sales to overseas countries. I am very glad to be able to report that while nearly all overseas countries, and particularly those of the sterling area, found it necessary to continue to impose restrictions against the dollar area, these restrictions are now being relaxed rather than increased. The rate of relaxation may not be as rapid as we in

The Address-Mr. Howe Canada might wish, or think justified, but at least we have reason to believe that the dollar problem is on its way to solution.
Imports rose even more rapidly than exports, from $2-8 billion in 1949 to $3-2 billion in 1950. Most of the increased imports came from overseas countries, contributing to their dollar earnings and thus helping to restore normal trade relationships. For the first time since 1931 imports exceeded exports.
I might point out that the small adverse trade balance reported above is an indication of increased internal activity, and particularly of increased domestic investment in productive facilities. It is traditional with us that adverse trade balances occur in periods of our greatest prosperity and that our highest favourable trade balances coincide with our periods of depression.
While on the subject of trade, it is appropriate that I should refer briefly to the efforts that are being made by the government to promote trade and a freer exchange of goods between nations. Hon. members will recall that, during 1950, restrictions upon imports under the Emergency Exchange Conservation Act were progressively relaxed and finally removed, which accounts in part for the higher level of imports.
The Canadian government is actively participating in the tariff negotiations and other trade discussions which have been under way at Torquay since last September. During the latter part of 1950, a trade delegation was sent to Latin America and succeeded in signing agreements with Venezuela, Ecuador and Costa Rica, providing for the exchange of most-favoured-nation treatment. A special mission visited European markets to promote sales of Canadian wheat and flour, with most encouraging results. We were able to arrange with the British government for a trade liberalization plan for our exporters to the British West Indies market, which arrangement came into force at the beginning of this year. Finally, I might mention the very successful international trade fair held in Toronto last year, and which will be held again in 1951.
The outlook for Canada's external trade during the present year is excellent, and the record levels of 1950 will probably be exceeded. The limiting factors will be those of supply. We are again in a seller's market for the goods normally exported by Canada. There are not likely to be burdensome unsold surpluses of any of our normal export products.
I will now turn to the other important dynamic element in our economy, the volume

of our investment in productive facilities. Here again a record was established during 1950. The total value of private and public capital expenditures rose by eight per cent over 1949. An interesting point is that businessmen altered their intentions within the year. Our early information was that investment in new machinery and equipment would be substantially down during 1950. Instead, this type of investment actually increased by five per cent, reflecting a change in the outlook during the year.
At the end of these remarks I shall, with the permission of the house, put on the record two tables which summarize investment expenditures, present and intended, and similar data on production of strategic basic and selected building materials. These two tables are advance statements of the two white papers on the investment outlook, 1951, and the building material outlook, 1951, which will be tabled as soon as they become available in printed form.
Expenditures on new construction increased by ten per cent in 1950, the increase being accounted for by industrial, commercial, institutional and government construction. Housing expenditures were up slightly in value, but down slightly in number of units, when compared with those of 1949. The number of houses started and completed in 1950 is estimated at 91,000 and 86,000 units, or two and six per cent respectively below the 1949 figure. This is reflected in the increase in the number of uncompleted houses at the end of last year, from 58,000 units at the end of 1949 to 62,000 units at the end of 1950.
Looking to the future, it is only too clear that during 1951 the limiting factor upon new civilian construction and upon the purchase of machinery and equipment will be that of supply. There is no lack of demand, no lack of confidence. A preliminary survey of investment intentions would indicate that private industry and governments are aiming at a capital investment program of $4,260 million, or thirteen per cent greater than in 1950. In view of physical limitations upon supplies, and the probable diversion of scarce materials and skilled manpower into high-priority defence and related production, it is unlikely that this objective can be attained in volume terms. Already, it has been necessary to prohibit the use of steel for certain types of non-essential construction, and restrictions on the use of steel and other strategic materials are likely to be extended from time to time.
The full impact of the defence program is yet to come. In the past twelve months,

defence expenditures accounted for about five per cent of our gross national product. This proportion will rise to eight or nine per cent during the coming year and will probably be taking an even greater part of current output by the end of the year. It should be borne in mind, however, that the impact of defence spending has, in large measure, been anticipated. For example, world markets for commodities such as rubber, tin, wool and cotton probably reflect anticipated demand, as well as present demand. I need hardly point out that there has probably been some spending in anticipation of shortages, which is producing present shortages where no present shortage need exist.
However, it must be recognized that the greater effort on the part of the free peoples of the world to prevent all-out war must inevitably cause increasing disturbance to usual living. There will be shortages. We must all learn to conserve scarce materials, and to exercise our ingenuity in the use of substitutes. Some plans for expansion and improvement will have to be postponed. Consumers may not have the wide variety of choice to which they are accustomed. These are inevitable consequences of military and economic preparedness, and I am sure that Canadians will take them in their stride.
In closing, I would like to say a few words about price control. The speech from the throne indicates the intention of the government to introduce a bill which will, if approved, confer upon the executive powers to impose price controls and other related controls for the purpose of maintaining economic stability.
These broad powers are being introduced to the end that the government will be in a position to take whatever action appears to be necessary from time to time. Introduction of this legislation does not mean that the present intention is to impose over-all price and wage controls, although there is always the possibility that events will develop in such a way that general price and wage ceilings are appropriate and workable. However, it should not be assumed, either, that a price ceiling is imminent, or that, if controls become more extensive, they will follow the pattern of those imposed during world war II.
The oyer-all ceiling worked in world war II. But it worked for very definite reasons and it cannot be assumed that history will repeat itself. Circumstances today are very different from what they were in 1941.
One of the secrets of the success of the over-all price ceiling was that we put it into effect overnight and without warning. It caught nearly everyone by surprise. This
The Address-Mr. Howe time many people expect the reimposition of the same kind of controls and are governing themselves accordingly.
The upward pressure on prices, both in Canada and abroad, was much less severe in 1941 than it is now. True, prices were rising during 1941 but they were still relatively low when the ceiling came into effect. Today, to pick a few examples, prices for wool, rubber, tin, cotton and other imported commodities are at the highest prices in history, and there is very little that Canadians can do about it.
Finally, we have to recognize that there would be a very different attitude towards over-all controls now from that which prevailed in 1941 when we were engaged in all-out war. In formulating plans for price controls, if we have to have controls, it cannot be assumed that the people of Canada will accept with the same willingness as they did in wartime the vast bureaucracy, the irksome restrictions and the other controls, for example, of wages, that go with an over-all price ceiling. I think it is significant, in this connection, that organized labour, while favouring price ceilings, does not look with equal favour on a wage ceiling.
I am not ruling out the possibility that sweeping price control measures will be needed, should the developing situation make action necessary, but it may well be that these measures should be different in form from those that were applied during the last war. Alternative measures are now under active study by the government.
At its last session, parliament enacted a measure authorizing the government to control prices of materials where shortage is caused by defence purchases. Up to the present time, defence purchases have not been of sufficient volume to be in themselves responsible for shortages, although prices of steel and other war materials have been kept under close observation. Obviously a more comprehensive price control bill is needed for any effective control of the Canadian economy, and it is such a bill that you will be asked to consider.
A few days ago the United States government applied a system of general controls to prices and wages. In some respects the action taken resembled the over-all price ceiling applied by the Canadian government towards the end of 1941. In other respects the U.S. controls are very different; for they do not apply, for example, to a great many foodstuffs which by the Defence Production Act cannot be controlled until they reach higher price levels.

The Address-Mr. Howe
We are watching with intense interest these efforts to control prices in the United States. We earnestly hope our American neighbours will succeed in attaining a reasonable measure of stability; for only if that happens can we in Canada hope to avoid serious trouble. Dependent as we are to a large extent upon the United States as a source of supply and as a market for our exports, it would be extremely difficult, even if it were wise, for us to insulate our prices from theirs.
I do not suggest for a moment that we can relax and let the United States solve our economic problems for us. That has never been our attitude, and, as long as this government is in power, that will not be our attitude. We must continue to pursue fundamental anti-inflationary policies as vigorously as ever. All I say is that if the United States succeeds in its efforts to stabilize prices, one of the most powerful external pressures toward rising prices in Canada will be relieved. At the present time, fiscal and monetary measures can be more effective
than price control in keeping internal inflationary pressures under control. With such measures in effect, there will be less need for direct controls of prices and wages, and if we do have to have more extensive direct controls, such controls should have a better chance of success.
Perhaps I should add, too, that even if we in Canada do not follow precisely the pattern of controls adopted in the United States, there will continue to be close cooperation between our two countries for the attainment of common goals. If we differ in method, we do not differ in objectives.
Mr. Speaker, I have only a few words to say in conclusion. It is most important that we should neither exaggerate nor underrate the magnitude of the task with which we on the production front are faced. We have to wage the battle of production against the enemies of freedom. We cannot hope to win that battle under the banner of "business as usual". There is much more than usual to be done, and I think that by united effort we can do it.



TABLE 1-NEW INVESTMENT IN DURABLE PHYSICAL ASSETS AND INVESTMENT INTENTIONS, CANADA, 1949-1951

[Stage Direction]
Type of Expenditure	New investment 1949	New investment 19500)	New Investment intentions 1951	Per cent change 1950-1951$Mil.	$Mil.	*Mil.	Business (2)	Primary industries(3) and construction industry...	623	668	658	- 2Manufacturing	536	519	716	+38Utilities	679	744	892	+20Trade, finance and commercial services	293	372	377	+ 1Subtotal	2,131	2,303	2,643	+ 15Other-	Institutional services (4)	190	210	270	+29Housing	767	780	798	+ 2Government departments^)	395	473	548	+ 16Subtotal	1,352	1,463	1,616	+ 10Total (6)	3,483	3,766	4,259	+13(«)Private-	All enterprises and individuals	2,555	2,772	3,086	+11Public-	All governments (2)	928	994	1,173	+18Total (6)	3,483	3,766	4,259	+13(<>)
(') Preliminary.
(2)	Including government-owned corporations.
(3)	Includes agriculture, fishing, forestry, mining, quarrying and oil wells.
(4)	Includes churches, hospitals, schools and universities.
(6) Excluding equipment purchases by the Department of National Defence. (6) Change in volume, 5 per cent; change in price, 8 per cent.
[Stage Direction]
The Address-Mr. Howe

[Stage Direction]
Material	Unit	Production		Production Intentions 1951	Percentage change 1950-1951
		1949	1950 (>)		
Iron and steel products-					
Pi" iron	Mil. tons	2-2	2-3	2-4(J)	+ 4Rolling mill products	Mil. tons	2-2	2-4	2-5(2)	+ 4Plumbing supplies-	Cast iron soil pipe and fittings	Thous. tons	47-6	53-6	59-5	+11Cast iron pressure pipe and fittings	Thous. tons	91-5	87-9	109-9	+25Steel pipe and fittings	Thous. tons	192-1	167-3	167-3	0Sanitary ware-	Bath tubs	Thous. tons	127-4	138-0	138-6	-(*)Sinks	Thous. sinks	188-3	177-7	177-8	-(*)Wash basins	Thous. basins	137-1	201-8	232-5	+ 15Heating Equipment-	Furnaces-Warm air and heating boilers..	Thous. furnaces	94-9	109-3	118-2	+ 8Electric water heaters	Thous. heaters	184-7	226-9	267-4	+ 18Hot water storage tanks (range boilers)...	Thous. tanks	189-1	188-2	173-8	- 8Cast iron radiators	Mil. sq. ft.	7-2	7-5	8-1	+ 8Other iron and steel products-	Wire nails and spikes	Thou^ tons	88-5	85-6	85-6	0Builders' hardware	Mil. dollars	9-6	8-9	9-5	+ 7Sawn lumber	Bil. b.f.m.	5-3	5-8	6-0(2)	+ 4Cement and cement products-	Cement	Mil. bbls.	16-1	16-5	16-9	+ 2Concrete brick and building blocks	Mil. pcs.	105-5	122-6	151-2	+23Cement pipe and tile	Thous. tons	137-8	154-4	153-6	-(')Clay products-	Building brick (inch sand-lime brick)....	Mil. bricks	366-6	392-0	406-0	+ 4Vitrified flue linings	Mil lin. ft.	1-2	1-3	1-4	+ 8Vitrified sewer pipe	Mil. lin. ft.	4-4	5-4	5-6	+ 4Structural tile	Thous. tons	172-5	179-0	192-1	+ 7Mineral wool products-	Mineral wool batts (all sizes)	Mil. sq. ft.	137-8	145-9	173-0	+ 19Bulk mineral wool (granulated and loose)	Mil. cub. ft.	14-8	14-1	14-9	+ 6Gypsum products-	Gypsum wallboard	Mil. sq. ft.	230-6	227-4	253-3	+ 11Gypsum lath	Mil. sq. ft.	174-0	218-9	240-4	+ 10Gypsum hard wall plaster	Thous. tons	160-8	166-3	199-7	+20Roofing products-	Asphalt shingles (all weights)	Mil. squares	2-1	2-4	2-4	0Smooth and mineral surfaced rolls	Mil. squares	2-4	2-5	2-5	0Miscellaneous products-	Paints, pigment and varnishes	Mil. dollars	82-9	87-9	91 -4	+ 4Non-metallic sheathed cable	Mil. lin. ft.	87-3	108-7	110-4	+ 2Rigid insulating boards	Mil. sq. ft.	227-7	227-3	267-4	+18
(*) Preliminary.
(2) Estimated.
(*) Less than one per cent.
[Stage Direction]
The Address-Mr. Murphy
Mr. J. W. Murphy (Lambion West):: Mr. Speaker, I should like to join with hon. members who have preceded me in the debate in complimenting the mover and seconder of the address. In view of what the minister has just said in regard to capital expenditures in connection with the Polymer Corporation at Sarnia, I should like again to express the hope that the government will give additional consideration to the protection of that very important area.
In his statement the minister said that the increase in the Polymer extension would amount to some $7 million. I speak for that riding when I say to the house that in addition to that we have an increase from the Imperial Oil Company to the extent of some $14 million, representing an increase in their refining capacity from about 65,000 up to around 80,000 barrels a day. We also have now under construction by Canadian Oil Refineries extensions valued at between $18 million and $20 million, and by the Dow Chemical Company extensions valued at about $3 million to $5 million.
One or two other industries have obtained properties to conduct operations essential to the war effort. It is unnecessary for me to remind the house how those various industries contributed at the time of the last war toward our war effort, and how this increased expansion is going to further the protection which is so essential at this time.
Last session when I raised this particular question the Minister of National Defence (Mr. Claxton) stated that we were relying in that area upon air protection from Detroit and London. I say in all sincerity that because of the importance of these industries to our war effort it is my hope that the minister will give further consideration to air protection for those very vital industries. In my view we should have not only an airport in that immediate vicinity, but some part of a fighter squadron.
The Minister of National Defence has outlined for Canada a defence program which will cost this country $5 billion in three years. Speaking as a layman in military matters, speaking as an ordinary taxpaying Canadian citizen, the situation as I see it today contains a tremendous element of tragedy. The tragedy simply is that this country will have one hundred ships to guard her coasts, and forty squadrons of aircraft to protect Canada and assist in the defence of Europe-but only $5 billion worth, and three years from now.
Meantime Canada has on the minister's desk a paper army, a paper navy and a paper air force. Of necessity the Canadian people will accept the minister's program and will

bear with determination the burden of a defence scheme that will cost them $1,600 million this coming year. But I would hazard that the people of Canada would accept that burden with a great deal more grace were they not so acutely aware that this government has failed them on so many scores in the post-war period. They would accept it in a better frame of mind if they were not now so conscious of the fact that the government has frittered away millions of defence dollars this last four or five years which could have been utilized to build so much of the equipment and so much of the strength that Canada's armed services need so urgently now.
Most of all they would accept it with greater equanimity if they could but be certain that Soviet Russia will permit Canada those three years in which to reconstruct and rearm. This is the real tragedy of the defence situation today as I see it, andi I am sure as the man in the street sees it. The threat of communism, the threat of Russia's imperialism, have not been sudden developments.
The menace of communist encroachment had become so apparent two years ago that it led to the formation of the north Atlantic alliance. That alliance has been functioning now for fifteen months, as the minister has noted. Surely fifteen months ago the Minister of National Defence was aware of the deficiencies in Canada's three armed services, aware that in entering a regional defensive alliance the country would be called upon for something more than comforting ministerial speeches to the effect that no power would dare attack twelve nations united in their determination to resist aggression.
I will readily concede that the organizational details had to be worked out, that discussions on national contributions to the pact consumed time. But the fact remains that this country, as did some of the others, entered the alliance with empty hands. Only the Korean conflict stirred the government to the point where it became aware that entering alliances and making commitments meant forces in being, meant troops trained and equipped, meant ships and guns and planes.	.
The explanation that it is difficult to prod democracies into defensive preparations while peace remains is one that is given altogether too much currency. It is one that even now is being debunked-has been debunked. The Canadian people have been concerned, indeed alarmed, by the complacency of their own government, in preparing this country to

defend itself from the menace that has been altogether too apparent, not for weeks, not for months, but for years.
In matters of defence and defence responsibilities, the government has lagged far behind Canadian public opinion. Instead of leading the Canadian people, it has been led. Or rather, it has been compelled to face the international situation and to decide that it is high time that Canada looked to her own security and the security of her allies.
It was only a session or two ago that the Minister of National Defence told the house that the defence forces of Canada were quite able to meet any initial attack or raid on this country. How fatuous such a statement must appear now.
Canada is to have a five billion dollar three-year program of rearmament. Canadians can only hope and pray that Russia will sit back and wait for Canada and her north Atlantic alliance partners to prepare for war, before she ignites the powder-keg that will touch off global conflict.
Canadians can do nothing but accept the rearmament drive as outlined by the minister. They understand the necessity for it. They hope, as he does, that it will achieve its purpose-to demonstrate to Russia that peace, after all, is the wiser course. But they cannot help the fearful feeling that persists, that the government has lingered too long before setting its hand to the task.
But there is a companion piece to this tragedy of national defence that is being enacted daily in the private homes across this country-the homes of pensioners, the homes of wage and salary earners, farm homes and city homes. It is the daily drudgery of penny-pinching to make ends meet. It is the story of the housewife in Sarnia and in Ottawa, in Winnipeg and in Vancouver, who daily is fighting a losing battle against the rising cost of living. And for the housewife with a family of small children it is a bitter struggle as the household dollar shrinks to the point where food has to be sacrificed in order to buy clothes, or clothes have to be sacrificed in order that enough can be provided the family to eat.
' Here again the federal government stubbornly refuses to translate into action facts as they exist.
In the period immediately after the last war the Progressive Conservative party advocated the abolition of controls. I believed then, and I believe now, that such a policy would have contributed to the quicker return of Canadian stability; would have eliminated artificial commodity shortages and artificial price props. Canada then was striving to return to a wholly peacetime economy.
The Address-Mr. Murphy
Now the situation has completely changed. This country no longer can pretend that its economy is on a peacetime basis. The government has launched on a program of controls in order to channel essential materials into defence production. The needs of the day and the hour dictate such a course. But, added to that, the government, with its multi-million dollar orders for supplies and for defence production, has accentuated an inflationary condition that already has become critical for hundreds, indeed thousands of Canadian families.
The Canadian government defence dollar now is bidding against the Canadian housewife's dollar. And that bidding is an unequal contest. By its bulk purchases and its channelling of materials the government is reducing the availability of goods and merchandise on the consumer market. As that availability shrinks, the cost of the items remaining climbs higher and higher. In other words, government policy today is creating and aggravating inflation. In view of this condition, it is not inconsistent now for me, as a member of the Progressive Conservative party, to take a definite stand for a system of price controls in Canada.
Indeed, in view of the tremendous volume of defence spending that now will be pumped into the Canadian economy and into the balloon of inflation, it is my personal view that a mere pegging of prices is not enough. Such a course would be too little; already is too late. I believe this government, for once, should demonstrate its oft-boasted concern for the ordinary working people of Canada and roll back, and I mean roll back, prices to the point where the Canadian dollar represents something more than a fifty-cent piece.
And this is not an irresponsible suggestion. The government has the experience of the last war upon which to draw; it has the multi-million dollar dominion bureau of statistics personnel and facilities upon which it can call for assistance. And it still possesses in the Department of Trade and Commerce a shadow controls organization to which it quickly could give substance. Undoubtedly, the machinery necessary for a selective system of price controls would cost money. But, as I see it, the well-being of the Canadian people is just as vital a matter of defence as any other phase of the national concern and the national effort. The struggle for freedom could be lost at home just as surely as it could be lost in Europe or in Asia, by neglect or lack of preparedness, or lack of intelligent and vigorous leadership.
It might be worth while to call attention to a recent speech in Montreal by Donald Gordon, president of the Canadian National

The Address-Mr. Murphy Railways and former chairman of the wartime prices and trade board. Mr. Gordon is quoted as having said:
Runaway inflation is so destructive that any method1 of stopping it, no matter how difficult or clumsy it may be, is surely the lesser evil.
And he went on to say:
The defence program already has begun to enter into the cost of living because, in a grim and very real sense, it has become part of the cost of keeping alive.
To this he added:
Clearly, our real standard of living is going to depend on the productivity of the whole Canadian economy, as it has in the past ... If prices jump upwards, no one will cheer more lustily in private, or scream more noisily in public, than our communist fifth column, and you can be sure they will work diligently to speed up the whirling spiral of wages and prices.
With those views of Mr. Gordon I am wholeheartedly in accord. Significant, I think, was Mr. Gordon's reference to the necessity for increased production. Here is a prime sore spot in the present emergency, a sore spot which a little government care and tending and encouragement could do much to relieve and to heal. Bluntly, Canadian labour-the factory worker, the office worker, the farmer, the wage earner and the salary earner of Canada-cannot reconcile a two-sided Liberal government philosophy and doctrine, which on the one hand holds to the gospel of individual economy and sacrifice, while adhering, on the other, to a "business as usual", "spend as usual" creed on the part of the government.
True, the government probably has made halfhearted efforts to economize. But the time has come when it must demonstrate the political courage to neglect its constituency fortifications, to shore up the ramparts of the nation. The time has come for real and genuine economies in the whole range of government activity, from reduction in government and government delegation journey-ings and junketings, to cutbacks on deferrable public works. The political toll on the Canadian taxpayer's dollar is altogether too high. If the Canadian people are to be called upon for sacrifices that will whittle down their standard of living, then it would seem reasonable that the government must also lower its own cost of living. And that cost is the price of patronage projects.
But to get back to Canadian labour-unionized labour and unorganized labour:	Today
Canadian manpower is being utilized to the full. There are pressing shortages for men in the skilled trades-toolmakers, diemakers and so on. These shortages will become more and more acute as the national defence program gains momentum. The throne speech made two or three references to the fact that

the international situation now had created for Canada an emergency situation. With that I agree. But I believe the government now should make some effort to bring home directly to Canadian workers the urgency of the world situation and the urgency of Canada's need for more and more production. To this end, I would suggest that through its Minister of Labour (Mr. Gregg) and its Department of Labour the government appeal to Canadian unions in all lines of endeavour to suspend for the duration of Canada's national emergency working contract clauses that stipulate the 40 hour week or less, and to permit working hours to be increased 10 per cent.
My own observations in this field have led me to believe that labour would be willing to increase its working hours, and thereby its production, at regular wage rates.
I believe, on the basis of patriotism, and as a direct contribution to Canada's defence effort, that labour would make this gesture. Indeed, many of the rank and file would welcome such an opportunity to supplement their present earnings. They would regard it in a sense as a way of earning their own cost of living bonus.
There would be a double incentive to the workers of Canada if such an appeal were made and accepted. There would be for the whole labour force the satisfaction that would come from the knowledge that they were doing their bit for democracy by increasing the production of all the goods and the materials needed for defence. There would be, too, genuine appreciation of the opportunity to add to their take-home pay. Perhaps the new advisory council on manpower, which the Minister of Labour (Mr. Gregg) announced to the house the other day, will consider this possibility in its survey and review of the Canadian labour scene.
A state of national emergency, however, applies not alone to one section of the population, one part of the national economy. A call for more production from Canadian unions and Canadian workers generally should be counterbalanced with a call on big business, big industry, to play its part.
The financial statements of a whole range of Canadian corporations proclaim Canadian prosperity and unprecedented profits. While it cannot be denied that a heavy burden of taxation upon industry and upon business discourages incentive, curtails expansion, and dries up investment capital, nevertheless these enterprises should be called upon now to bear a far greater part of the tax burden than they now are bearing.
These corporations and companies today are enjoying the profits of the free enterprise

system, the capitalist system, the system which all Canadians in all walks of life now are being called upon to defend, in and out of the services, and to the tune of $5 billion in the next three years. The fight of Canada and the free nations, then, is their fight just as much as it is the fight of Canada's liberty-loving citizens generally.
To the degree that the threat of Soviet Russia and of communism constitutes a national emergency for Canada, the Canadian government should be prepared to act with courage, with dispatch and vigour to draw taut the whole fabric of the Canadian economy. There must be equality of sacrifice. Canadian determination must match Russian ruthlessness.
It must be a source of regret to the Canadian government in the present emergent situation that in the years immediately following the last war it did so little to encourage the flow of immigration to this country. Canada today stands in need of skilled labour for her defence plants, labour for her farms, for her forests and mines, and for her armed services.
The Minister of Citizenship and Immigration (Mr. Harris) in this year of crisis has announced that the government has set its sights on something like 150,000 immigrants for 1951. The minister now has announced what he has described as a balanced program to provide more hands both on the farms and in the factories.
The government has taken several steps which it hopes will help to double the 1950 immigration total of 74,000. In succession it has lifted the wartime ban on German nationals, has decided on a fare subsidy plan for those who come to Canada by air, and has decided to advance passage money to those seeking to come to Canada by ship. But even a doubling of immigration may prove insufficient because it appears possible now that the manpower shortage will become more serious than present estimates indicate.
The Minister of Citizenship and Immigration is quoted as saying that Canada must push forward its industrial and economic expansion if it is to become an effective partner in the defensive preparations of the western world. How pitifully late is this statement of government policy! Now, in a year of national emergency, the government deems it wise to bring to Canada thousands of people from Europe to plug the gaps in Canada's manpower supply. Ever since the last war other nations have been actively encouraging British and European peoples to migrate. The best of the great reservoirs of manpower in Britain have been tapped while
The Address-Mr. Murphy Canada dallied. The same applies to Europe with its potential emigrants and its thousands of refugees eager to gain the freedom and the opportunities that this young country affords.
Today Australia is competing for new citizens more energetically than is Canada, and its goal of 200,000 immigrants annually is considerably greater than that of Canada. Reports from Europe indicate that at least 200,000 suitable refugees still are homeless, and that many Germans want to emigrate.
Tragically enough, this government well may have tarried too long. The manpower problems that confront Canada in all probability will be the major problems that confront Britain and other European nations in this emergency year of 1951. Already it is indicated that Britain is becoming reluctant to part with her manpower-the skilled workmen needed just as acutely in British defence and other plants as they are required here.
The new Minister of Citizenship and Immigration perhaps is to be congratulated that he has been able to persuade the government to enunciate a program of 150,000 immigrants for this year. But the uncertainties of the world picture now have created new difficulties which may prove far greater obstacles than any that have existed since the war with nazi Germany ended. Now, when the government apparently is sincere in its desire to increase Canada's population by immigration, it may find desirable immigrants far more difficult to obtain. As in the matter of national defence, the Canadian government now can but scramble to overhaul lost time, can but seek to repair damage already done.
About a year ago the defence minister told the house, when he was presenting his estimates, that:
Our planning must look several years ahead. On the one hand, we must start to work in time to produce the results in personnel and equipment when they are likely to be needed. On the other hand, we must avoid starting things now which might involve us in future commitments for the expenditure of money which might be needed for other defence purposes of greater priority.
Within months came Korea. It was immediately -clear to all Canadians that its government had not been looking ahead to such an eventuality. Personnel and equipment were not there to match Canadian ministerial speeches at home, at the United Nations and in the councils of the north Atlantic alliance. It would seem that the government now is looking three years ahead. But there have been dangerous delays. Canadians are ready to play their full part. But they look to the

The Address-Mr. Riley government now to demonstrate a degree of foresight and of leadership that hitherto has been conspicuous by its absence.
For the government's military preparedness program there will be general public sympathy and support. In the meantime there will be, too, the prayerful hope that once again the government has not been too late; that Soviet Russia will give Canada three years of grace in which to knit her economy for the strains of war, perhaps a war of nerves but nonetheless war, three years of grace in which to recruit, train, equip and field Canada's fighting contribution to the cause of freedom and democracy.


Mr. D. A. Riley (Saint John-Alberl):: Mr. Speaker, before I launch into the main topic of my remarks today I should like to apologize for not having been present here for a short time yesterday afternoon. With some of my constituents who had journeyed here from afar I was attending to the business of my constituency. I especially regret my absence because I was thereby denied the rare privilege of being mesmerized by the golden voice of a great speaker, one who awakens reminiscences of the grand old days when oratory flourished in this land and in this very house. As the logical utterances of this hon. member are carried about the commons as in a silvery chariot guided by his dulcet tones-


Gordon Graydon: You are doing pretty well yourself.


Daniel Aloysius Riley: Thank you-one can fairly
envisage the spirits of Macdonald, Laurier and McGee gazing down with benign approval from the linen ceiling of this chamber. Some hon. members of the C.C.F. party are apparently aware of whom I speak, because I see signs of great enthusiasm over there. He is a kindly man, a great champion of the downtrodden, a friend of labour, a man of letters, a bachelor of arts, a teacher of man, an Ichabod Crane, a moulder of little minds. On those occasions when I see the hon. member for Saskatoon (Mr. Knight) part the curtains on the opposite side of this chamber and stride confidently to the seat which he occupies with such an air of wide dignity and legislative resolve I confess to a feeling of envy and wish secretly-to myself, mind you -that we could have such a giant on this side of the house so that I and some of my associates might look to him at times to guide our awkward steps as we bumble about in the dark recesses of the back benches. When I am lulled into revery by this soothing voice, this man with a heart so filled with the milk of human kindness, a heart which like that of St. Philip Neri well nigh bursts the


frail casement which encloses it, I say to myself, "Here is a noble man whose very soul would rebel in horror at the thought of stooping to mean, cheap, contemptible political advantages."
Like him, and following him I feel like a frail skiff wallowing in the foaming wake of a giant leviathan of the deep; like him, I must administer a gentle rebuke to the hon. member for Prescott (Mr. Bruneau). So in all kindness, having the highest regard for the Saskatoon Star-Phoenix, I must attempt to straighten out the question of how the hon. member for Saskatoon stands on price controls. Of course the hon. member has spoken at a number of meetings recently at which he expressed himself in favour of price controls, fixed ceiling prices on all commodities including-and the hon. member will correct me if I am wrong-labour, the price of wheat, and all other agricultural products. I would point out to the hon. member for Prescott that he might well take a lesson in unselfishness from the hon. member for Saskatoon when the latter thus tells the farmers of his own province that the prices of the commodities they produce must be pegged in safeguarding the interests of the common weal.
I was delighted to learn that the hon. member for Saskatoon had been in the maritimes, even in my own city. Though I had no word of his visit, I must confess I should have realized that the healthy glow which suffuses his cheeks bespeaks contact with the salt tang of the broad Atlantic. And witness his use of the word "fathom". It has a distinctly nautical flavour. I should have liked to introduce the hon. member to our dock workers. I should have liked to escort him down into the pit of our drydock. I should have liked to take him down into my own ward, where his soft and delicate hand, might have tingled from the healthy handclasp of the workingman. And I should have enjoyed even more taking him out for a short trip on the tossing waters of the bay of Fundy. I am sure the experiences thus gained by him, albeit new, would have been of inestimable value in his sincere effort to improve the lot of those of us who make up the proletariat of this country. He might have found that we maritimers, in our ignorance, I must admit, refer to his doctrines - perhaps erroneously - as the impracticable and meaningless theories of long-haired idealists; and he might have discovered how the misguided workingman of my own city seems intent only upon gaining for himself a decent standard of living and for his children an opportunity to fit themselves into society as useful Canadian citizens.

I agree that the hon. member might have found in my city some elderly folk living in rather modest circumstances. He neglected to add-and of course I do not accuse him of wilful neglect-that these people are very proud that, pitifully small though their means may toe, they have been rescued from an even worse fate by the sound administration which has been in power in this country, by the will of the people, since 1935.
My hon. friend referred to the slums of Saint John and mentioned having seen elderly folk living like rats in the garrets of those slums on an income which he gave as $42.50 a month. This comes as somewhat of a revelation to me, in that previously I had been under the impression that elderly people who existed on an income, not of $40 a month as we have for the elderly people of New Brunswick but of $42.50 a month, lived not in the unpretentious though solidly constructed houses of Saint John but in the shanty jungles within easy reach of his own home.
(Translation):
A few years ago, one of his colleagues, who has no longer the honour of sitting in the house, mentioned the slums she had seen from afar, in my city, during a whirlwind trip through the maritimes. Were she here today, she could repeat his remarks and they would be in harmony with what my hon. friend has said. Unfortunately, she had to go back before her electors, who are apparently fickle for they refused to repose once more their trust in her. I hope, and I believe, that with the decline and disappearance of socialist theories in our country, my hon. friend's career will come to an equally abrupt end.
This eager representative of the people who, in the past, filled his leisure deluging our legislators with countless pages of his turgid oratory for which he took inspiration in the warmth, safety and comfort of his quarters in parliament, had occasion, while on a tour of the maritime provinces, to come in contact with people whom he only knew, until then, from his perusal of books on socialism. I hope the experience he gained during that trip will encourage him from now on to support any government bill aimed at ensuring a more equitable distribution of that wealth which, thanks to Divine Providence, is so plentiful in this country, instead of cluttering up Hansard with senseless and groundless diatribes.
The Address-Mr. Riley
I hate referring to my good friend in such terms, but I know he will accept my remonstrances leniently and in the same spirit that prompted them.
(Text):
Mr. Speaker, I wish to congratulate the mover (Mr. McMillan) and the seconder (Mr. Breton) of the address in reply to the speech from the throne. I wish to extend also sincere congratulations to the Secretary of State for External Affairs (Mr. Pearson) who, with a number of his colleagues, has made such outstanding contributions in an honest and healthy endeavour to bring about peace among all men of all nations. The people in my part of the country look to the Secretary of State for External Affairs with unswerving confidence, conscious of his ability to exert an effort beyond the ordinary in bringing about the fulfilment of Canada's great role at the conference tables of the nations. In common with the people in other sections of Canada, we too are proud of him.
The Minister of National Defence (Mr. Claxton) must still recall the expressions of confidence accorded to him, and the enthusiasm with which he was greeted in the course of his recent tour of the maritimes. The citizens of my own constituency, and they but reflect the feeling of their neighbours across the land, are girding themselves for great sacrifices if such must be made for the preservation of our democratic way of life.
Today as I gaze over the heads of the executive who guide Canada's destiny I cannot help but refer to another man who seems to me to be somewhat like Gunga Din. I liken him in some respects, but not in all, to that famous Kipling character. From time to time he is literally belted and flayed by both friend and opponent, but when there is a job to be done requiring tremendous effort, wise and quick decision, and almost superhuman perseverance we look to him with deep respect, and we solicit the services of the right hon. Minister of Trade and Commerce (Mr. Howe) to perform another mighty task for our country.
We are about to embark upon a vast program of defence. Industrial Canada is prepared to increase production to an almost unheard-of degree. Defence orders have begun to pour out from Ottawa in an ever-increasing flow. We find that if we are to maintain our production schedule it may even be necessary to import labour from other lands. It is amazing for me to view and to hear about the vast expansion which industry in Ontario and Quebec, and in some of our western provinces, is undergoing now. I am proud
194	HOUSE OF COMMONS
The Address-Mr. Riley when I reflect that my country is well on the way to becoming one of the largest producer nations in the world.
At the same time it grieves me to have to state that in the course of a recent review of employment figures across Canada I have been shocked to learn that unemployment in some of our most important maritime centres extends far beyond the ten per cent mark. I am, therefore, impelled to urge once again, as I have urged before from the floor of this house, that a real effort be made to bring about some degree of decentralization of industry in our country. In my own city of Saint John the unemployment figure is down somewhat in comparison with last year's figure. This has been due in part to an accelerated movement of freight through our port during the course of the past few weeks, but it is also due in part to an accelerated movement of our skilled, semiskilled, and even unskilled labour to the booming industrial centres in the provinces of Quebec and Ontario.
Every day from all over the Atlantic provinces this movement continues. Maritime labour is once again answering the call of industry further inland. If our labour continues to thus migrate to the central provinces-


Percy Ellis Wright: Hear, hear.


Daniel Aloysius Riley: I am speaking also for the western provinces, as my hon. friend is well aware.


Percy Ellis Wright: I agree with you.


Daniel Aloysius Riley: It is fine to hear his voice raised occasionally in the House of Commons, because I have sat here for the last few days wondering when he was going to make, not a simple ineffective speech in opposition but one of those mighty speeches that we have heard him deliver in the past. I am keenly disappointed that this hon. member, who must definitely be aware of the great role which he must play if he is conscious of his responsibilities in parliament, has not given more effective opposition to this government which he persists in criticizing by means of catcalls in a sotto voce.


Mr. Knowles:: Somebody must have sent you a dictionary.


Percy Ellis Wright: He must have swallowed it.


Daniel Aloysius Riley: The catcalls are coming from the hon. member speaking at the moment, and it is so interesting to see him with a smile on his face that I do not deign to answer.


Stanley Howard Knowles: It is not a smile, I am laughing.


Daniel Aloysius Riley: It is even nicer to see you laughing. I am surprised that your face did not crack.
If our labour continues to thus migrate to the central provinces, I am afraid we are going to find ourselves in an even worse position that ever before in our history after the present crisis is over. The only profitable business venture in which we shall be able to engage will be the retailing of cheap cardboard suitcases. I do not want to give to hon. members the impression that I have come here to give voice to a plaintive wail, nor do I wish to convey to hon. members of this house the idea that I or the people whom I represent are looking to the government to create vast industrial centres in the Atlantic provinces. I want to point out, however, that the defence program on which we are now embarked, calling as it does for the expenditure of billions of dollars, provides for the government of this country a ripe opportunity to stimulate the development of the far east and the west, by assisting and encouraging both the establishment and the expansion of small industries.
I have taken the time to discuss our problems with many of my constituents and they consistently ask me to make known to the government that they are willing and ready to build and to manufacture whatever the government might suggest for them so to do. They would prefer, of course, to manufacture commodities which could be produced by small, light industries.
I have here on my desk a letter from a young man in my constituency. He is the type of young man who is intensely interested in the development of his own province. He is a member of a family which has built up several small industries and who himself sees for the Atlantic provinces a great future looming on the horizon. In this letter he makes an offer to supply the necessary land, buildings and operation for any type of industry for the manufacture of defence needs. The land and buildings which he makes available are in a favourable locality, close to facilities for shipment by water or rail. He has in mind that when the present crisis is over this plant could be used to house a stable peacetime industry.
I also have here on my desk another letter from one of our younger citizens who is intent upon merchandizing a commodity considered to be the best in quality and the most practical of its kind manufactured in this country. It is a commodity which is now being manufactured almost exclusively in the United States for the government of that country. The raw material is in such great

demand by the American manufacturers that the producers will have to curtail delivery in Canada unless the manufacturer here is able to get defence orders. That manufacturer himself, a ranking air force ace of the first great war, can increase his production to meet any government needs in this country. Despite our efforts to interest government officials in this commodity over the past few months we have not yet been successful. There is in my constituency a group of men who are at present preparing to found another industry. They have at their disposal an excellent plant for the type of commodity which they propose to produce. In addition, they have a great deal of extra floor space available, and1 they have asked me to in turn ask the heads of our government what they would like them to produce with this extra space. I had in Ottawa with me the other day one of these men, a highly skilled technical man who during the last world war managed several industrial plants engaged solely in the manufacture of defence items. I hope that his visit here will not have been in vain. Several other industries, already established, have sent representatives to me asking for direction on how they could best serve defence requirements, and they have stated their willingness to expand their plants to take care of whatever orders might be forthcoming. I have sent the names of these firms to the government agencies which might be interested and again I am hopeful that orders will be forthcoming. In checking over the lists of orders placed by Canadian Commercial Corporation since November 20, 1950, it has been a source of keen disappointment to me and to my constituents to note that orders going to the Atlantic provinces have been so pitifully small, so pitifully few and have amounted in value to such a meagre sum of money that I would be ashamed to place the figures on the record of this house.
I know that during the past two years some authorities here in Ottawa have at the instance of the Minister of Trade and Commerce (Mr. Howe) and the ministers representing the Atlantic provinces made extensive studies with a view to stimulating our economic development; but I again regret to say that the subjects of these studies have not yet tasted the fruits of their findings. I repeat that if ever there was an opportunity for the federal government to infuse a real stimulant into the economic life of our lagging provinces, that opportunity presents itself today. I should hate to have to thank those responsible a couple of years from now for an abundance only of sympathy received by our people. I would rather be able to say 80709-13a
The Address-Mr. Riley that the twenty-first parliament marked a milestone in the growth of the Atlantic provinces, the beginning of a realistic exploitation of their resources of materials and manpower.
It was a source of great satisfaction to me, as it was to many of my fellow easterners, to read the speech delivered by the premier of Ontario at the conference of federal and provincial governments here in Ottawa a short time ago. Speaking to the assembled delegates he expressed on behalf of his government a real appreciation of the problems which confront provinces other than his own. In the course of his remarks he directed attention to conditions in some of these other provinces, and I quote:
Problems associated with large concentrations of industry, are, however, in the main incidental to these areas having such industrial development. What I have said makes evident the desirability of an even development of Canada. Large concentrations of industry in particular places in Ontario have created large provincial problems. A development of Canada with large concentrations of industry in particular provinces and little industry elsewhere creates like problems.
Perhaps it would be well if this conference, as part of its work, would consider ways and means of providing for a more even industrial development across this country. It is very heartening indeed to see the expansion in the two far western provinces of British Columbia and Alberta.
May I say just here that I had hoped that when the welfare state had been introduced into Saskatchewan there might have been a better measure of industrial development there; but apparently it has not taken place. I continue with the quotation:
It is to be hoped that the other provinces may show a like development, and we here should do everything possible to stimulate such development. The more even the development of this country the better it will be for all of us.
I hope that the words of the premier of this great province reflect the general feeling of her people; for what he said on that occasion can bode well for the future of those provinces in less favourable geographic locations.


Mr. Victor Quelch (Acadia):: Mr. Speaker, I listened attentively to the Minister of Trade and Commerce (Mr. Howe) when he spoke this afternoon. It was my feeling that his speech was a strong argument in favour of the immediate introduction of an over-all system of price controls.
I jotted down a number of points he made when he was speaking-that our economy was operating at full capacity; that there were limiting factors in export trade, namely supplies; that the full impact of the defence program is yet to come; that the defence
196	HOUSE OF
The Address-Mr. Quelch program will disturb our way of living; that there will be shortages. All these point to an increase in the inflationary pressure.
He said there is no intention to impose an over-all system of price and wage control at this time, but that it may be necessary in the future. He does not rule out that possibility. He made it clear that the success of the overall system of price control in the last war was due to the fact that it was brought into operation overnight. I could not help thinking that if I were a businessman in this country, with no greater principles perhaps than many others, after hearing the minister's speech X would say to my colleagues, "Gentlemen, you have heard the program. The best thing for us to do is immediately to increase prices as other businesses are doing, or we will be left holding the bag." Judging by what is happening in Canada today, no doubt there are many businessmen who feel that way, and who perhaps will direct their energies to an even greater extent in that direction after reading the speech delivered by the Minister of Trade and Commerce.
We have before us a subamendment moved by the C.C.F. and reading as follows:
That the following words be added to the amendment, immediately after the words "rising cost of living" in the last line thereof:
"such as the immediate reimposition of price controls, and the payment of subsidies where necessary, so as to protect the health and living standards of the Canadian people."
That is an amendment to the amendment; if it were not I would offer an amendment to insert the words "and wage" after the word "price". However, I do not think that is really necessary. One may well take it as written, because surely no thinking person today would suggest for one moment that we could have an over-all system of price controls without at the same time controlling costs in that price structure. I understand the C.C.F. fully appreciates that fact. Therefore we can take it as though that were written into the amendment. Let me make it clear that in supporting the subamendment we do so on the definite understanding that an overall system of price controls would include control of all costs incurred in that price .structure, including of course wages.
When the Prime Minister (Mr. St. Laurent) *spoke in this debate with reference to controls he said, as reported at page 29 of Hansard: There cannot be enforcement in a country like ours against the feeling of a majority of the people of what is right and what is wrong.
Surely no one would suggest that today the majority of the people would not support a system of over-all price control. I do not think anyone would argue for one moment, 

for example, that labour would oppose it. Labour has taken a strong stand in support of over-all price controls. I doubt very much if anyone would suggest that the general consumer in Canada would oppose it. Stop people on the street and ask them if they are in favour of price controls, and in ninety-nine cases out of a hundred they would say that they are.
Speaking as a farmer I would say the farmers would not oppose the introduction of price controls. I noticed that when the leader of the C.C.F. party was speaking, the hon. member for Mackenzie (Mr. Ferrie) said that the farmers were opposed to it. The farmers are not opposed to price controls, so long as they are brought in in an equitable manner. That was made clear in a resolution passed by the Canadian Federation of Agriculture in Calgary last month. A report of that convention, as it is contained in the Manitoba Co-Operator of February 1, 1951, states in part:
Producers were concerned with inflation and controls, and on this subject gave unanimous support to a resolution requesting that if anti-inflationary measures, taken by the government of Canada, include price control, these controls should not be first levied against foodstuffs, but should go into effect simultaneously with wage controls, industry profit controls and that any controls on foodstuffs be imposed on a proper relationship and costs of production.
I believe that is the general attitude of all farmers. They want price controls on all commodities. They are quite prepared to have the prices of agricultural products controlled, too, so long as the prices of those products are controlled at a parity with the general price level.
Certain people in the country today and certain members in the house are warning of the dire consequences of introducing an over-all system of price controls. The hon. member for Vancouver-Burrard (Mr. Mac-Dougall) adopted that attitude when speaking in the house on February 6. He quoted from the Financial Times of British Columbia and, in making the quotation, said he thought it was a sound and sensible argument.
Let me quote one part of the quotation to which he referred with approval in the house:
There is really no choice. Comprehensive direct controls would defeat the purpose in the following ways:	They would drive the economy into a
regime of black markets and administrative paralysis: would destroy public morale and the incentive to produce, and would conceal inflation, without preventing it. They would in any event require crushing taxation to be practical at all.
This article states that price controls would destroy the incentive to produce. Would anyone suggest that the over-all system of price controls during the second world war

destroyed the incentive to produce? We know very well that during that war our production increased at a record pace, and to record levels. Furthermore when the hon. member suggests that price controls would require crushing taxation it must be obvious that if we do not have price controls we will have to have even heavier taxation. That was realized when price controls were introduced during the second world war.
These arguments and warnings against price controls are similar to some of the arguments we heard in the early stages of that war. For instance, on November 21,
1940,	as reported at page 286 of Hansard, the minister of finance of that day, Mr. Ilsley, replying to a suggestion from this group that an over-all system of price control should be introduced, had this to say:
Price fixing of a few commodities, indeed rationing of a few commodities, is possible and need not have a very serious effect, but price-fixing and rationing on a general scale have at least two disadvantages. In the first place this would call for bureaucratic interference in the private affairs of all Canadian citizens.
After that he allowed his imagination to run riot and said that if we had price controls we would have to put a spy in every grocery store in Canada. He said that kind of thing might be all right for nazi Germany but that the people of Canada would not tolerate it. That was the statement of the minister of finance of that day. It is interesting to note however that he did a backward somersault in the following year, because within less than a year he had completely changed his mind. .
On November 6, 1941, he v|jis commenting on the government's proposal \o bring down an over-all system of price control.
This is what he had to say, and I quote from page 4148 of Hansard of November 6,
1941,	as follows:
But there is no doubt that when the resources and labour of the country are pretty fully used, when we reach a stage of full employment, and are making more and more war materials, devoting a larger and larger proportion of our human and material resources to the production of war equipment and war materials, there is no doubt that inflationary forces of a very powerful type are at work.
And again:
One will see at once that, unless curbed, forces will push the price levels up and up and up. How can that be stopped? Since the beginning of the war we have pursued a severe taxation policy. We have tried to tax as much as possible of the purchasing power back into the exchequer. We have gone all across the country and combed it for small subscriptions to war savings certificates. We have sold bonds to the people. In these ways, namely by taxing and by borrowing, we have tried to get back from the people a large amount of this purchasing
The Address-Mr. Quelch power. We believed that this was a right policy and we believed that it was anti-inflationary. To a large extent it was.
And he goes on to say:
Therefore, in this war, no matter what the course has been in previous wars, so far as I know all countries have come to the conclusion that they must resort to direct measures of limitation and control of production, and price control.
Hon. members will notice that in those statements the minister stresses the fact that prices were steadily rising in spite of heavy taxes and fairly heavy borrowings of the savings of the people and for that reason price control was necessary. It is interesting to note what the price level was at that time when the minister drew attention to the way it was going up. He stated a serious situation had developed at that time. The price level had gone up from 108.2 in March 1941 to 115.1 in October, 1941. If the fact that the price level had gone up from 108.2 to 115.1 was then a justification for price control, then how much more justification there is today for price control when the cost of living index has gone up to around 172.5?


Stanley Howard Knowles: The food index is 220.


Victor Quelch: The hon. member for Winnipeg North Centre (Mr. Knowles) points out that the price of food has gone up to 220. That is especially hferd on low income groups. Many people without thinking blame the farmers for that situation. They say that the prices of farm produce have gone up considerably and that the farmers are profiteering. I believe all hon. members received a copy of a pamphlet entitled, "Labour Research," containing a good article which I think all hon. members should note, headed, "Is it the farmer's fault?" This reads:
Some might rashly assume that these figures are evidence of the irreconcilability of workers' and farmers' interests. But they aren't. In September last, the dominion Department of Agriculture published a report on Marketing Margins for Selected Canadian Agricultural Products, 1935-1949. The products are potatoes, eggs, fluid milk, creamery butter, cheese, beef (commercial quality), wheat flour, white bread and canned tomatoes.
The results are very carefully qualified and hedged about with warnings that they must be used only with the greatest care, and with full allowance for all the qualifications. But one fact does stand out, unmistakably:	That the farmers''
share of the retail price in 1949 was not, in most cases, substantially different from what it was in 1946. The only notable exception is potatoes, where the farmers' share fell off 20-8 per cent. In five of the other eight cases, also, it fell off, but only by much smaller percentages:
That shows that any increase that has taken place since 1949 in the price level is not due to any increase in the prices paid to the farmer but is the result of increases in the price spreads. Of course that is something that should definitely be dealt with at the earliest opportunity. In his speech in

The Address-Mr. Quelch 1941 the minister referred to the fact that at that time they had heavy taxation, but in spite of that heavy taxation they were not able to keep prices from rising. Taxation may have been heavy in the minds of the people in 1941, but taxation is also quite heavy today. I notice that in 1941 the total revenue from taxation was $771,540,000 or a per capita tax of $67. In 1942, the year in which really heavy taxation was introduced, the revenue had increased to $1,360,913,000 or a per capita tax of $120. In 1949 the revenue had gone up to $2,436,142,000 or a per capita tax of $180.
Some will say that we should not forget that the national income has also gone up. That is quite true, but the value of the dollar today is only fifty per cent what it was in those days. I simply want to point out that the arguments used by the Minister of Finance at that time to justify the introduction of price controls are equally applicable to the present situation. I would like hon. members to note the similarity in the other inflationary pressures that were referred to. The minister stressed the fact that we had full employment at that time. This afternoon the Minister of Trade and Commerce (Mr. Howe) told us that we have full employment in the country at the present time. He pointed out that we were havirfg to divert goods from the channels of consumption to wartime needs. The Minister of Trade and Commerce also stressed the fact that a greater percentage would have to be diverted in the future.
Then there is another psychological effect that exists today as it existed then. It is true that we were at war in those days, but today the government is continually stressing the seriousness of the international situation. If the situation is as serious as it is said to be, then no doubt we are going to have to make great sacrifices in the future, sacrifices that will greatly increase the inflationary pressure. Therefore, if the argument of the Minister of Finance in 1941 was sound and justified the introduction of price controls, then I would say that there is even greater justification today for the introduction of price controls.
Some people seem to fail to realize that great changes have taken place in the general economic picture since 1945 and more especially since June of 1950. Let me review briefly those changes. It will be recalled that at the end of the second war there was a strong inflationary pressure in this country, due mainly to three things. The first was the accumulation of war savings which then became a demand against goods. The second was the fact that we were reconverting war industries to peacetime production and the

The Address-Mr. Quelch and as a result of subsidizing the consumers in this country, should be made up out of the general revenues of the government. The Alberta wheat pool has suggested that this payment should be 25 cents a bushel. Let us not forget that even if a payment of 25 cents a bushel is made, the farmers will still be standing approximately 50 per cent of those losses. That is all a 25 cents per bushel payment would represent. It has been stated by the Minister of Agriculture (Mr. Gardiner) and others that the interim payment of 20 cents a bushel on the 1950 crop is helping to alleviate any difficulties the farmers may be having in meeting their present obligations. That is only partly true. Unquestionably it helps the farmer who threshed a crop, and who was able to sell that crop. We must not forget, however, that many farmers who raised crops in 1950 still have those crops under the snow. In the constituency which I represent I should say, as a conservative estimate, that at least 50 per cent of the crops east of Hanna are still under the snow. You are not helping those farmers a bit by making an interim payment of 20 cents a bushel on a crop which has still to be threshed. Then again there are those in the more fortunate position of having threshed their crops, but who have been unable to sell them owing to the congestion at the elevators. I was told by certain officials in Alberta that generally speaking the wheat has been pretty well cleared away along the Canadian National lines, but that there is still a tremendous amount of congestion on the main C.P.R. line in Alberta. Those farmers face a very serious situation. Not only have they not been able to sell their wheat, but unless those crops, which in many cases are very damp, are moved at a very early date, there is great danger of spoilage. So I believe that as rapidly as possible the government should increase drying facilities, because we are continually running into this difficulty of handling our grain in a tough or damp condition.
I think it is high time the five-year pool was cleaned up. I listened to the Minister of Trade and Commerce (Mr. Howe) speak to the farmers' union of Alberta in Calgary last December, and he left the very definite impression that the final payment would be made in January. He did not give very much encouragement to the farmers as to what the amount might be, but certainly they got the impression that the payment would be made in the very beginning of the year. Then in January the Minister of Agriculture spoke to the convention of the Canadian Federation of Agriculture, and he made the whole picture very cloudy indeed. He said the Prime [Mr. Quelch.J

Minister (Mr. St. Laurent) was conversing with Mr. Attlee in an attempt to get more money under the "have regard" clause of the British wheat agreement and that now the whole question was up to Mr. Attlee. The minister did not know when Mr. Attlee would come through, and until such time as he did there could be no final payment under the five-year pool. So the matter was left in a very unsatisfactory position. However, today I was glad to hear the Minister of Trade and Commerce say he would do everything in his power to see that the payment was made before the beginning of spring seeding.
Another question I want to touch upon today is the price of wheat. Hon. members will recall that we signed an international wheat agreement, which received the support of the house. At that time I warned of the danger of trying to guess what the price of wheat or any other commodity would be in the future. I stressed the fact then that it was quite easy to establish a fair price for the current year, but that when you tried to say what that price should be, one, two, three or four years hence, you were guessing and the government might very well guess wrong, as they did under the British wheat agreement. Therefore at that time I urged that instead of adopting the policy outlined in the international wheat agreement we should first of all set the price for the current year at what we considered a fair level, and then tie the price of wheat to the general price level, so that if in future the price level of the importing country went up 10 per cent the price of wheat to it would also go up 10 per cent. If on the other hand the price level went down 10 per cent the price of wheat would go down by the same amount. In other words you would be establishing a parity price on an international basis. Apparently the government did not consider that proposal worth while, so today we are faced with the fact that there is a ceiling of $1.89 on wheat. No matter what happens to the general price level, even if it goes up another 50 per cent, the price of wheat is tied down.
Does anyone suggest that the farmers should have a ceiling on wheat when everything else is allowed to go free? Then in addition we arbitrarily reduced the floor under wheat by 10 cents a bushel a year. Why? Would anyone suggest any reason why the floor price under wheat should be reduced by 10 cents next year, 10 cents the year after and 10 cents the year after that, when the prices of everything else are going up? That is why I argued at that time that the basis for payment under the international wheat agreement was not fair, and that we

The Address-Mr. Thatcher
would never get a fair base until we tied the prices of farm commodities to the general price level on both a national and an international basis. In other words I was asking for parity prices both nationally and internationally.
In conclusion I would say it is high time the government brought in a long-range policy for agriculture based on parity. Only in that way can we assure the most efficient operation of agriculture in order to help provide the supplies of food so urgently required in many parts of the world today. The Secretary of State for External Affairs (Mr. Pearson) stressed the fact that we cannot hope to defeat communism by the force of arms alone, that we will also have to provide economic aid to the backward countries. The sort of aid most urgently needed in the world today is food. Therefore it is up to us to maintain our agriculture at the highest possible state of efficiency, so that we may make our greatest contribution to good will and contentment in the world.


Mr. W. Ross Thatcher (Moose Jaw):: Mr. Speaker, I rise this afternoon to deal briefly with two specific matters. The first has to do with a recent announcement of the Liberal government, which I desire to criticize and protest against. I refer to the decision to apply dumping duties to automobile imports from certain European countries including Britain and France. Surely that decision can only be described as a short-sighted, narrowminded policy, which is sacrificing the interests of the Canadian people as a whole to certain pressure or protectionist groups.
I should like to remind this house, and particularly members on the government side including the hon. member for Fraser Valley (Mr. Cruickshank), of the traditional, or perhaps I should say the professed, trade policy of the Liberal party during the past few decades. In public utterances, in parliament and elsewhere, not once but a hundred times, speakers of the Liberal party have stated that their government is working towards freer trade and fewer trade restrictions. I believe most members of the house would agree that the former prime minister, Mr. King, was an authority on this subject. He stated that Liberal trade policy in 1945 was as follows, and I am quoting from Maclean's magazine dated February 1: The Liberal party stands for the removal of barriers to trade, and is opposed to the principle of protection which is really a levy on consumers in Canada for the benefit of the protected industries.
On numerous occasions I have heard the Minister of Finance (Mr. Abbott) speak along similar lines. I have one quotation from a speech he made in Toronto a little more
80709-1*
than a year ago. According to the Globe and Mail of October 29, 1949, the Minister of Finance was thus reported:
But the solution of Canada's problem, he said, would depend on expanded trade, the lowering of trade barriers and the elimination of arbitrary restrictions and discriminatory practices.
I have one other quotation which I should like to put before the house. It is one which was made a short time ago by the leader of the Liberal party in my own province" of Saskatchewan. According to the Regina Leader-Post of December 12, 1949:
Walter Tucker, Saskatchewan Liberal leader, Friday night called upon the federal government to abolish all tariff and other restrictions on imports of British goods.
How can any member of the government reconcile words such as those, how can he reconcile the past professed trade policy of the Liberal party, with this action to apply dumping duties against British and French cars? It would seem that there has been so much talk of Korea, so much talk of national defence and the major issues, that the protectionist forces of this country thought they might get this act passed without anybody noticing it. I say that this dumping duty is completely undesirable.
Ever since the end of the war I have heard government speakers urging British industry to get its prices down to competitive Canadian levels, and to produce goods which Canadians wanted. According to the Prime Minister, according to the Minister of Trade and Commerce (Mr. Howe), and according to the Minister of Finance, it was by such means that Britain would be able to earn the Canadian dollars with which to buy our farm products, our timber products, and our ocean products. After all, if Britain is to buy from us, I suppose it is natural that she wishes to sell us goods to earn Canadian dollars. The British automobile industry accepted the admonition of our government. It got its prices down; it produced goods which Canadians wanted; it earned Canadian dollars. What is its reward? Apparently its reward is to be this so-called dumping duty.
Mr. Speaker, it seems to me that if we are to continue trading with the British we shall have to give them an opportunity of earning Canadian dollars. It would seem to me also that a government which has always stated its desire for freer trade would be more interested in securing markets for farm products in Britain than in giving a specific industry special protection.
Today the price of Canadian automobiles is almost beyond the reach of the average Canadian consumer. British cars are supplying a need in the Canadian market for cheaper

The Address-Mr. Thatcher transportation. If this duty is proceeded with it can only help to send the already skyrocketing cost of living up even further.
I say that this proposed dumping duty is all the more inopportune when we realize that at Torquay, at this very moment, many of the free nations of the world including Canada are discussing ways and means of eliminating this sort of restriction. There are few things which could so darken the prospects of success at Torquay as this new protectionist measure of our own government. I say that to raise these barriers in the midst of an international effort to lower them is an act of economic folly.
Why has the government decided to proceed with these dumping duties? We must assume that the action has come as a result of representations from the automobile industry. Were those representations justified? I should like to remind the house, Mr. Speaker, of two factors in connection with those representations. First of all, Canadian cars have roughly doubled in price since 1939. Today Canadian automobiles are so high in price that many Canadians, indeed I would say the majority of Canadians, cannot afford to buy them. Second, I would remind the house that the Canadian automobile industry already has ironclad protection from United States competition, because of tariff and control regulations. Having no fear from United States competition, the Canadian industry instantly protests as soon as the British competition becomes a little too serious.
I have always heard Mr. Sale, the president of the Ford Company of Canada, and other Canadian industrialists, pay great tribute to this free enterprise system, as they like to call it, and competition. Why now does Mr. Sale, as well as the others, protest competition as soon as it appears?
Is Canadian industry suffering because of this British competition? Has the industry been forced to curtail production in any way? Every member of this house knows that today the Canadian automobile industry cannot supply enough cars. If anyone wishes to buy a Ford, a Chevrolet, a Plymouth, or any other model he has to wait some months to secure delivery.
Is there any unemployment in the automobile field? There is not. On the contrary, today there is a shortage of skilled workers. There was an article in the Saturday Night this week which says, and I quote from page 42:
Canada's preparedness program now faces a threat no less serious than a steel shortage-skilled labour. All the emergency legislation, all the controls that our government or any other government could dream up might alleviate a skilled labour

shortage in the defence industries, but they could not increase the supply of highly-skilled labour in anything less than years.
In view of the war in Korea there is every indication that in the next year or so Canadian industry will be able to supply even fewer cars than it does now. By no stretch of the imagination can it be said that British imports are a threat to the Canadian automobile industry. I say that the request of this industry is a short-sighted, narrowminded request made on the basis of selfinterest. If the Canadian automobile industry wants to sell more cars in Canada, let it produce them more cheaply. I shall tell the government, although they will not listen to me, that this proposal is causing considerable concern in Canada, particularly in western Canada where the farmers are wondering why the government is taking such a step. I hope they will immediately withdraw these ill-advised dumping duties which they plan to impose on May 31.
Mr. Speaker, the second matter with which I should like to deal briefly-I think I can finish before six o'clock-has to do with the announcement made by the Minister of National Defence (Mr. Claxton) last Monday evening. He said that during the year $1-6 billion will be spent on national defence. It is of course virtually impossible for opposition members who have not taken part in the many conferences under the Atlantic pact, who have not attended the military talks, to know whether this $1-6 billion is too much or too little. As opposition members, we have little choice but to accept the words of the minister that this spending is vital and essential.
Having done that, I think that the citizens of Canada do expect us to diligently and carefully scrutinize the details of these expenditures and the estimates, in order to make sure the taxpayer is getting value for his dollar. I remember that last year the Minister of Finance said at page 1992 of Hansard:
I believe that the public of Canada have the right to expect parliament itself, the members of parliament itself, to exercise a constant and vigilant scrutiny over the conduct of administration, to search for waste and duplication.
Last Monday evening the Minister of National Defence said that 80,000 contracts had already been let.
It is going to be a terrific task to go over 80,000 contracts. Nevertheless, I believe it is our duty at least to make an endeavour. I personally believe, with other members who have spoken this session, that the only proper way to do that is by means of a special defence committee. I would like to see a specific committee set up for that purpose. I

think most members of this group feel likewise. However, if that is not going to be done, we must have some other vehicle for the purpose. I personally doubt if the government has much to hide; yet their great reluctance to set up a special defence committee has caused many people in the country to wonder if they have. If we are not going to have a special committee, probably the next best vehicle is the public accounts committee.
I was indeed pleased to hear the Prime Minister (Mr. St. Laurent) the other day state-at least I took him so to state-that opposition members would be given the opportunity in the public accounts committee to examine defence expenditures. As reported at page 111 of Hansard, the Prime Minister said:
There will be an opportunity for hon. members, including the members of the opposition, to examine in the public accounts committee all the expenditures that have been made.
I hope that the Prime Minister will tell his chairman and the other Liberal members on that committee about that statement; because last year the Minister of Finance (Mr. Abbott) made a similar statement. As reported at page 1991 of Hansard it was as follows:
Let me point out to the house that the public accounts committee is a standing committee of this house . . . and there is opportunity in the public accounts committee for any hon. member, and in particular for hon. members of the opposition, to ask that any deputy minister, or any official of any department, be brought before that committee, and to examine him to their heart's content as to the details of the particular services of the department.
The minister last year said that. But when we got into the committee, although the members asked for a good deal of information, they were not able to get it. Opposition members asked for witnesses, they asked for figures, and they asked for the public accounts. They asked for many things, but they did not get much satisfaction. We were repeatedly overruled when we sought information, and we were consistently refused the public accounts themselves. I think that committee sat for three months before it even got to the public accounts.
I would remind the house of one thing further. Last year the hon. member for Winnipeg North (Mr. Stewart) asked that that committee be called for the specific purpose of inquiring into national defence expenditures. Yet all during those three months, despite many requests, we were not able to get the national defence expenditures brought before us. I hope the minister will give some assurance that the same thing will not happen again. Let me say that Canadians want defence expenditures scrutinized. If the government is sincere in also wanting them
80709-14J
The Address-Mr. Thatcher scrutinized, I hope they will call the public accounts committee together, if that is to be the committee, and that they will call it together early. Perhaps it would be wise not to spend so much time as is customary with Mr. Sellar. Let us get down to the national defence expenditures at once and stay there.
The other evening the hon. member for Quebec South (Mr. Power) stated his opposition to calling the chiefs of staff before a parliamentary committee. I admit that I know little about military matters; but nevertheless I presume to disagree with the hon. member for Quebec South in this connection. These chiefs of staff, these men who are high up in military affairs, are the experts and they are the ones who should be able to inform parliament about defence matters. They should be the ones to tell us what is being done, how it is being done, why it is being done, and whether or not we are getting value for our defence dollar. Surely an explanation by a parliamentary committee could be conducted with some dignity and with a proper regard for security. The Minister of National Defence (Mr. Claxton) should not be the only one who knows the reasons which require the spending of this $1.6 billion. I serve notice that this group will, as soon as the debate on the speech from the throne is finished, seek to have the public accounts committee called in order to deal with national defence expenditures. If or when it is called, this group will seek to call before it the defence minister himself, the chief of the general staff, Air Marshal Curtis and many other officials whom we may feel could give information which the people of Canada would like to have. I think one more thing should be done; if the government really wants to make this an effective committee, let them do as is done in England. Let them make the chairman a member of the opposition. Then I think we might get a proper scrutiny of defence expenditures.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock.
Mr. G. A. Cruickshank (Fraser Valley):: Mr. Speaker, more than ever I wish we had amplifiers and recorders in the house.


Mr. Gibson:: You do not need them.


George Alexander Cruickshank: I should like to have a recording of that splendid applause-for which I arranged, myself. I am glad to see that the opposition benches are beginning to fill up, and particularly with those members who are interested in external affairs.

The Address-Mr. Cruickshank


Gordon Graydon: Hear, hear.


George Alexander Cruickshank: 
An hon. Member:: A naughty word!


George Alexander Cruickshank: Yes, a naughty word. I had a clipping before me the other day-

and, by the way, I am getting like some of the others in that I have so many clippings that I get lost in them. However I did have one here about the bridge-and I will have to be more careful with them, because I seem to have mislaid it. I will find it after a while. That clipping said-I am sure it was correct: If you are flirting around with Quebec for votes, be careful never to mention conscription. That apparently is the policy of the opposition.
My stand on conscription, when speaking before the Legion, as it is tonight, is that I think it neither desirable nor practicable nor necessary at this time. But if the day should come when there is a vote on conscription I will vote exactly as I did before, and make exactly the same speech as one colleague from British Columbia made with me in 1944. Incidentally, through you, Mr. Speaker, I say to the people of my riding that I believe that if the time ever comes-and members in all parts of the house hope it may never come- but if the time ever comes when conscription is necessary to protect our very existence and to maintain the forms of government and liberty in which we believe, Quebec will be in the forefront and serving with all the rest of Canada.
I am willing to concede that in military knowledge some members of the official opposition far exceed me. We remember that it was only a few years ago that they appreciated the fact that the Bren gun was not necessary! Then, again, they were able to foretell that we had not trained our troops for a sufficient length of time before they went to Hong Kong! Now I understand there is a great rush among them to send troops to Korea with only a couple of weeks of training. I should like to refer to what a colleague on the other side of the house, one of the finest soldiers Canada ever had, the hon. member for Nanaimo (Mr. Pearkes), had to say. If you can understand just exactly where he stands in connection with this horrible word "conscription" or in connection with compulsory service in the reserve army, you are very good. What he said reminds me of my Uncle Horace. My Uncle Horace killed a pig but he said afterward, "It didn't weigh as much as I thought it would; I didn't think it would." I should like to quote what the hon. member for Nanaimo said, as reported on page 99 of Hansard of February 5, as follows:
-and even though I might hold different views as to the methods by which these forces should be raised, X think it would be detrimental at this time to advocate strongly methods which the government is not prepared to follow, because I believe it is of paramount importance that the government raise the men that it requires, and the government alone will say by what method it will raise those men.
The Address-Mr. Cruickshank
A little further along on the same page: -or in any way put any hindrance in the way of the national effort carried out by the methods recommended by the government to meet what X consider to be a grave situation.
I should like to ask hon. members of the house if the hon. member has answered the Canadian Legion's demand for 250,000 strength. It may be that the reserve army will have to be kept up to strength by compulsory means. If the time comes when we must have conscription I will be ready to say in my riding, even though it costs me every vote in the riding-probably I will not get the few votes that they will get if they do not fall off a bridge like that one down in Quebec-that I am ready to support it.
I pass now to another military expert from my province, the hon. member for Vancou-ver-Quadra. First I am going to deal with his remarks on manpower and then I shall turn to external affairs. I do not know whether he is the assistant leader of his party in that particular branch. It is quite easy for the hon. member to make speeches in Vancouver about the necessity of raising forces, but it is a different matter when you come down here. I want to assure everybody in my riding that at no time since 1940 have I been approached by the whip or by any member of the government to tell me what to say when I came before the house.


Mr. Sinclair:: Fat chance.


George Alexander Cruickshank: The hon. member for
Coast-Capilano (Mr. Sinclair) has interjected a remark. I do not know whether he is trying to give me the benefit of his mature judgment or whether an attempt is being made to see that I carry on along the right lines in support of the government because I seem to be surrounded by parliamentary assistants of all sorts.


An hon. Member:: That is why you are doing so well.


George Alexander Cruickshank: For the benefit of the
hon. member who says that that is why I am doing so well may I say that two years before he was moved over here behind me I was two rows closer to the Prime Minister's desk than he is today. The hon. member for Vancouver-Quadra is reported as follows on page 165 of Hansard of February 7:
This house would be well advised to listen to the pleas for action by these bodies of Canadian, veterans.
I suggest to the hon. member for Vancouver-Quadra that he should state where-he stands in so far as the supplying of manpower for the armed services is concerned, and this should include the reserve army as well. As I said before, if it ever becomes necessary to have all-out conscription, L

The Address-Mr. Cruickshank shall vote for it. However, I have complete confidence in the Prime Minister (Mr. St. Laurent). I believe that he appreciates the situation. My confidence in the Prime Minister is such that I believe that if and when the time comes that action is required nothing will stand in the way of his directing whatever is necessary to preserve the freedom we now have.
I do not want to keep the house too long because I recently read an article by the Canadian Manufacturers Association about speechmaking. I do not own a lumber company or a packing plant so it is not very often that I agree with them. However, they said that a speech should never last more than twenty minutes and they said one more thing with which I definitely agree, something which is not followed by 85 per cent of the members of this house, that a speech should not be read. If at any time I do read a speech I shall be different from even some of my colleagues on this side of the house and will admit that I am simply reading what some member in the press gallery has written for me.
Perhaps I should not be too hard on the hon. member for Vancouver-Quadra because he comes from my province. Perhaps instead of pointing out the mistakes of the hon. member I should point out the mistakes of hon. members from Ontario or the maritimes, although I do not know that there are any members in the opposition from the maritimes.


An hon. Member:: They do not make mistakes.


George Alexander Cruickshank: I am going to get over to Saskatchewan and cartels in a minute. A remark was made by the hon. member about our external affairs. I want to say with all respect that from the time this department has borne the distinguished name it has Canada has never had the privilege of having at the head of this department a gentleman with the capabilities of the present Secretary of State for External Affairs (Mr. Pearson) or anyone who has enjoyed such respect throughout the world. I should like to quote a further remark by the hon. member for Vancouver-Quadra, as reported on page 163 of Hansard, as follows:
The handling by the government of Canada's activities in the Korean crisis has been one of the most disgraceful episodes in Canada's history.
That remark should never have been placed on Hansard as it brings no credit to the party the hon. member represents and it definitely brings no credit to the province from which we both come. I have nothing at all to be ashamed of as the member for Fraser Valley

of the part Canada has played in the Korean or any other war that involved the freedom of the peoples of the world. It is a most peculiar thing that the representative of one riding should say that there has been a disgraceful handling of affairs by a man possessing the capabilities of our present minister. The status of our minister is borne out by a question asked on Tuesday by the hon. member for Peel (Mr. Graydon) when he inquired if our minister had accepted the invitation extended to him by the president of the general assembly to serve on the good offices committee with respect to oriental problems. If that is not a compliment to the Canadian minister of external affairs, I should like to know what it is. I think it is one of the finest compliments that could be paid to him or that could be paid to Canada for the part she is playing in the Korean and other crises.
In case it may be thought that I am altogether too favourably inclined in my remarks, I should like to move on to the question of controls. Perhaps I cannot speak on controls with the authority with which certain Saskatchewan members speak. It must be realized that we farmers in British Columbia do not go in for chain farming. We operate just one farm, not five or more. Of course I can speak only for myself, but I think the Minister of Agriculture (Mr. Gardiner) will permit me to say that we are both free traders. If we are able to convince the rest of the people to be free traders, we shall have free trade in this country.


James Sinclair: What about margarine?


George Alexander Cruickshank: What about margarine? I left one of the finest clippings I ever saw on this matter up in my office, but I think I can remember enough of it to be able to get down to margarine in a minute. In the meantime let me say that if anybody gets the benefit of our economic way of life in Canada it is the retailers of hardware products. I do not know anybody who gets more benefit than the retailer of hardware products. I know because I bought a Mix-master wholesale through a certain friend, and I still paid 20 per cent profit to him. I believe controls are inevitable. That is my opinion. I have a little bit more hopeful view than might be taken after listening to the Minister of Trade and Commerce (Mr. Howe). I presume he still has the same title. He comes from the head of the great lakes, and they change their titles and portfolios so often, but I will call him Minister of Trade and Commerce.
I am very hopeful yet, but if controls are put into effect in so far as I am concerned they must not be put into effect as they were

The Address-Mr. Cruickshank
in the last war, starting at the farmers' level. If the people of Canada try to kid themselves that throughout the war period they got bread at a reasonable price through Donald Gordon, they are all wrong. The reason they got bread at a low price was that it was at the expense of the wheat growers of western Canada. If controls are to be instituted let us not start at the level of the farmer. Do not forget that the farmer is not only a producer but also a consumer. I do not want to say too much about controls, but the government has a measure before the house- and I presume it will be voted on-involving when controls should be introduced and what shall be put under control. My own opinion is that controls must be across the board. If controls are imposed they must be on wages and everything else.
In the meantime, however, I believe that controls should be exercised by taxation through the Department of Finance. Even some of our lumber friends know that. I do not want to point directly so I will point to both of them over there.


Mr. Ross (Souris):: Leave those independents out.


George Alexander Cruickshank: They come from the
Kootenays, that glorious part of British Columbia. I believe the way to have controls now is by taxation through the finance department. Here I want to say that I believe no government, be it Liberal, Conservative or, God help us, C.C.F., has any alternative but to do something about the cost of living so far as pensioners and others on low incomes are concerned. I know of the case of a widow of a veteran of two wars, in one of which he won an honour that I should like to have, the military medal. She is suffering from arthritis and is unable to do anything. She is receiving from a grateful government $40 a month. It is not good enough. I believe the people of Canada do not want that sort of condition to exist. I believe the people of Canada do not care what taxes are imposed upon them as long as no veteran's widow suffering from arthritis has to live on $40 a month.
We are spending billions on war; we can find billions to build jet planes and so on because we have to build them to protect our free institutions; but any government that can find ways and means through taxation or otherwise to pay $400,000 or $500,000 for an aeroplane surely is admitting weakness if it cannot find the money to provide a decent living to burnt-out veterans and other recipients of pensions. So far as I am concerned I will do my utmost throughout this session to see that the government rectifies the error of its ways in the past in that regard.
I should like to endorse something that the hon. member for Quebec South (Mr. Power) said the other day with respect to a check on defence expenditures. I do not see why the government should object to that. I know we have a public accounts committee. I nave been a member of it ever since I have been here. Last year we sat and spent our time on a one-man fishing expedition trying to find out about the Bren gun and the North Star aeroplane. We do not want that sort of stuff as I see it when it comes to checking war expenditures. What we do want to see is that the money is spent to the best advantage in defence of our country. I believe that such a committee should be set up.
I disagree with my friend, the hon. member for Moose Jaw (Mr. Thatcher), in the suggestion he made. Speaking with a little bit of military knowledge, I think it would be ridiculous to bring the heads of the army, navy and air force before a committee. It would undermine the whole idea of military discipline. It would be detrimental to our war effort in every way, shape and form. I think if the hon. member will consult any of the military members of his own group he will find that they will agree with me that it is not practical and, pardon the word, it is senseless to expect to bring military men before such a committee to use them for a political football, for purposes of political gain at the expense of our national defence effort.
I mentioned pensions a moment ago, and I include old age pensions. I understand that legislation is to be introduced to permit the levying of a three per cent provincial tax. I am not quite sure of the legal situation because in the province of British Columbia they put such a tax on, but it was not a hidden one. Of course in our province they can do almost anything. When you buy your driver's licence they make you pay five years in advance. If you live in British Columbia under the present government you might have to forgive anything because any government that can levy a tax five years in advance is a pretty good one. I expect that the income tax is going up this year. I am very thankful that you cannot levy income tax five years in advance, knowing the disposition of the parliamentary assistant to the Minister of Finance. I want to tell the government that I am going to oppose the three per cent tax so far as possible.
I should like to turn for a minute to margarine because the subject has been introduced by one of my colleagues.


James Sinclair: Free trade.


George Alexander Cruickshank: Yes, free trade, and we believe in free trade, but just before I came
208	HOUSE OF
The Address-Mr. Cruickshank east a firm in Vancouver sent me a sample of fertilizer to try in my garden. I wish I had brought with me the description of that sample. It is up in my office. It indicates all the things that they had taken out of whale oil. They even took the odour out but they left the oil. When my colleague wants to ruin 500,000 dairy farmers in order to put such junk as whale oil into something to put on the tables of people who unfortunately cannot afford to buy butter at present prices, I should like to tell him that he would be far better advised, particularly in the happy position he holds in the right branch of the Department of Finance, to see that the taxation system is such that those who can afford to bear it will pay in order that the people can buy butter at a reasonable rate.


James Sinclair: Free trade.


George Alexander Cruickshank: I quite agree with the statement credited to the Minister of Agriculture (Mr. Gardiner) in one of the best papers in Vancouver under date of January 15. The headline is, "Butter holds power in Canada."


James Sinclair: Free trade.


George Alexander Cruickshank: Again I am getting interjections from my junior colleague on the left. We are short of butter and he has played a large part in the fact that we are short of butter. He introduced this axle grease, with the result that the farmers sold their good heifers because there was not the demand or the price for butter; they were being undersold by this colourless, useless stuff that he brought into our country legally, through the decision of a few judges. I am now surrounded by $32,000 extra a year; but those gentlemen surrounding me would not be getting the extra money but for the fact, as they said, that butter holds the balance of power in Canada. So I think they should cease their opposition to butter and stop supporting margarine. I hear someone say "sour grapes." You know the way businessmen generally go about arriving at a figure for a key man in their business. They size up what they are paying an executive in this department and a superintendent in that department, and make up their minds accordingly. I have come to the conclusion, with this galaxy of extra talent around me, that when my turn comes, if the Prime Minister will divide the $32,000 in proportion, 1 will get more than they will.
I am sorry to have taken so long; I would not have done so but for these interruptions.
I want now to turn to public works, and I am going to be very brief. We see the results of one of these five-year plans over here at the fire trap called the east block. Why, any


good Fraser Valley farmer could put that roof on in three months, but they have been at it for two years. Some years ago, before I came to this house, there was a popular song called, "I know where the flies go in the wintertime." I never knew until this year, but now I see that as part of the five-year plan they are finally taking the fly screens off that building, in this kind of weather.


Gordon Knapman Fraser: The efficient Liberal government.


George Alexander Cruickshank: Yes; but if it had been a C.C.F. government the screens would have been on there still. In 1948 this government was most generous to the farmers of the Fraser valley, as was the provincial government. That year we had a disastrous flood, and while this government had no legal responsibility it recognized a moral obligation and responded generously. On behalf of the people of Fraser Valley I want to say that we appreciate very much the generosity that was extended to us. Ninety per cent of the dikes happen to be in my riding. The federal government invested some $10 million in those dikes. Forget the farms in that valley; forget, if you like, the third largest city in Canada. The fact remains that we have $10 million of the money of the people invested there. Last year we had very high water before the dikes could properly settle, with the result that parts of them washed away and we found weak places. So I believe it is incumbent upon some authority to find the small amount of money necessary to repair the damage and reinforce the weak spots.
I have some pictures here; I am only sorry all hon. members cannot see them. One shows a hole 30 feet deep and 130 feet long right into the dike. I was able to show that hole to the parliamentary assistant to the Minister of Finance (Mr. Sinclair), the future minister of agriculture, and also the hon. member for Glengarry (Mr. Major) and the hon. member for Norquay (Mr. Wood). One of those gentlemen was only an engineer; another sold what we produce on the farms; but the third was a real farmer. It does not make sense to me, Mr. Speaker, that a government should spend $10 million and then, for the sake of a paltry few thousand dollars in addition, let the original investment be wiped out. Why, within 150 feet of the weakest spot in that dike we have the main line of the Canadian National Railways, the main line of the Canadian Pacific serving Fort Lewis and the main line of the British Columbia Electric. In one day at the beginning of the year eight troop trains went over one line, near my house. I realize that the provincial government should make the move, but they have done

nothing. If the provincial government does not have the gumption to do anything about it, it seems to me the federal government, who have been so generous and fair to us in the past, should cut oil some of their grants, or give them a boost in some other way, to see that this work is done. We in British Columbia have tried, but we cannot hope to wake them up until the -next election, when once more they will try to ride in on the back of the Liberal party here in Ottawa.
I am serious about this; I think it is very important. As I say, we appreciate the generous treatment we were given, and surely it is good business to spend another few thousand or few hundred! thousand and do the necessary work to protect our investment of $10 million. I thank hon. members for being so patient with me. In passing I might say, for once, a good word about the Canadian Manufacturers Association, which is a great organization. I could never hope to achieve membership in that organization unless, by some chance or other, I should happen to engage in the hardware business.


Mr. George H. Hees (Broadview):: Mr. Speaker, during the next three years this country will spend $5 billion for defence. This will necessitate a curtailment in the production of a great many different kinds of goods, and the facilities producing them will have to be diverted to the production of defence materials. This will create shortages in many of the necessities of life which are in free supply today, and the bidding for the fewer goods available will cause prices to rise rapidly.
In addition, the wages of the extra people needed in industry and the armed forces to carry out a worth-while preparedness program will increase the amount of money available to bid for these goods. This will further accelerate the rise in prices.
The net result of all this will be that speculators will make tremendous profits, and the buying public must foot the bill.
During the past year we have had an increase of ten points in the cost of living index. This has caused severe hardship to pensioners and those in the lower income brackets. Further accelerated rises in the cost of living-due to defence preparedness- will create an intolerable situation for all our people, if they are allowed to go on unchecked.
It is obvious, therefore, that a defence preparedness program must be accompanied by over-all price controls.
At the same time that price control is introduced, it will be necessary to introduce wage control as well, because you cannot
The Address-Mr. Hees expect the cost of goods and services to remain stationary while the cost of the labour producing them increases.
Together with price and wage controls, of course, must come rent controls to protect those whose incomes will become controlled. This will create no hardship for landlords, because the cost of the things they buy, and the people they hire, will also be controlled.
As it will take some considerable time to set up the machinery for over-all controls, I strongly urge the government to set the machinery in motion now so that our defence preparedness program may proceed without causing great hardship to the people of this country. Prices have already risen considerably in anticipation of controls. Every day we delay their imposition, the more prices will continue to rise.
The Minister of Trade and Commerce (Mr. Howe) this afternoon indicated that if the government should ever get around to doing something towards controlling inflation, the method they would prefer would be fiscal and monetary measures. These will not do the job, for two reasons. First of all, they are only directed against one source of inflationary pressure, namely the supply of money. Second, in order to get results, these measures would have to be applied with such severity that the result would be hardship among many income classes. An authority for these views is to be found in the report of the royal commission on prices, volume i page 42, paragraph 6. It reads as follows:
For reasons which are outlined in chapter 6, it was decided that fiscal and monetary actions, though an essential part of the full program, could not be depended upon to curb the powerful inflationary forces then being put in motion. More direct action was necessary. Which should it be, an intensification of the use of selective controls, firmly fixing prices and regulating uses but confining these actions to key and basic commodities; or placing a price ceiling on all goods and services, with accompanying production and distribution controls? The choice fell on the over-all ceiling policy, for reasons which were outlined by the Minister of Finance in the House of Commons on November 6, 1941, and have been further discussed by Mr. K. W. Taylor.
Now, just as fiscal and monetary measures alone will not do the job, neither will selective controls, and for three reasons. First of all, they are discriminatory. Second, we have today no unused resources. Selective controls might work if we had vast unused resources of men and materials, but they will not work in a condition of full employment such as we have today. Third, industry is too integrated and interdependent to seal off a section of it manufacturing the necessities of life only.
The forces that are generating this inflation are too strong to be dealt with by other than an all-out attack, using all weapons. An

The Address-Mr. Johnston authority for those views is the report of the royal commission on prices, volume 2, page 90, paragraphs 2 and 3, where it is stated:
As we see it, selective price control may be justified under exceptional circumstances for a temporary period. It may, for example, be justified by a temporary restriction of imports for exchange conservation purposes which, if allowed to affect prices, might result simply in a fortuitous profit to domestic producers, and if some imports are permitted to importers. Selective price control, combined with subsidies, may also be justified as a means of slowing down the wage-price spiral, on the assumption that the rise in the cost of living is temporary and will soon be replaced by a decline. In specific cases of acute shortages of important commodities, direct controls may be necessary to ensure that the scarce supplies are directed to where they will best serve the national interest.
Except under such circumstances it is doubtful, however, if selective price control has much to commend it in ordinary time. It is bound to be discriminatory. It is extremely difficult and complicated to administer. Most important of all, and particularly if subsidies are paid on the controlled goods, selective controls are more likely to augment the inflationary gap between demand and supply than to reduce it. If a general attack on inflation is to be made, the weapons should, in the main, also be general, directed to bringing the flow of money available for expenditure into equilibrium with the supply of goods and services available for purchases.
It therefore seems to me, Mr. Speaker, that we are entering a period' of extreme inflationary pressure, for a substantial rearmament program is being imposed in an economy which is already fully extended. I believe there is only one way to meet this condition, and that is by making use of all the measures available to us, namely:
(1)	Over-all price and wage controls;
(2)	Fiscal and monetary measures; and
(3)	The distribution and allocation of materials.
I sincerely urge the government to take action in these directions at the very earliest possible moment.


Mr. C. E. Johnston (Bow River):: Mr. Speaker, when the date was set for the opening of parliament I believe most Canadians, and certainly all members of parliament, expected to attend one of the most serious sessions of parliament held in a long time. Since coming to parliament it seems to me that there has been a great deal of shadowboxing between both the old line parties. Each seems to be afraid to speak out in terms that the ordinary people of Canada will understand. It reminds me a great deal of the beginning of the 1939 session when war was declared. At that time the Liberal party said in effect, "We will tell the people everything if necessary, but not necessarily anything."
I have been waiting with a great deal of concern trying to find out from spokesmen
[Mr. Hees.l
on the government side of the house exactly how serious the international situation is. I do not think there is anyone in this house, and I am sure there is no one in Canada, who is not greatly concerned with the international situation as well as the domestic situation. I read the speech from the throne with a great deal of care. I listened to the speeches made by the Leader of the Opposition (Mr. Drew), by the Prime Minister (Mr. St. Laurent) and by the Secretary of State for External Affairs (Mr. Pearson).
In the speech from the throne I could not find very much apart from generalities. It referred to a number of amendments which were going to be introduced. We all expected these amendments because there are some every session. There will be amendments to the veterans pension legislation, amendments to the Canadian Citizenship Act, the Immigration Act, the Post Office Act, the Central Mortgage and Housing Corporation Act and the Emergency Gold Mining Assistance Act. Then there was mention made of new tax agreements with the provinces. It is true that it did not overlook the international situation. It outlined the international situation in general terms. It drew to our attention the gravity of the situation. But when one compares some of the remarks which have been made by responsible persons, one begins to wonder how serious the situation is. The Prime Minister has been reported to have said that there is too much talk about war and that he is still confident that there will be no war in his time. In his speech in the house, as reported at page 26 of Hansard he even went on to say:
In spite of the gravity of the situation I do not believe a world war is inevitable.
Of course I do not think anyone would say that it was inevitable. We all trust that it is not. We trust that we shall never again have to face a war. But one of the best ways to prevent war is by being thoroughly prepared. In the September session, I recall the Minister of National Defence (Mr. Claxton) telling us how well this country was being prepared, and how adequate our forces were then to take care of any immediate situation. Then when it came to the Korean war we found that we did not even have any troops prepared with which to take our share in the Korean conflict. Now we are going to spend $1-6 billion in defence; and over the period of three years we are going to spend $5 billion in war preparations. These figures would indicate that we were not at all well prepared before the Korean outbreak.
I do not profess to be any authority whatever on military or foreign affairs, Mr. Speaker. I have never studied that subject

The Address-Mr. Johnston
since I have been here in the House of Commons, although I have listened to the speeches carefully. I must therefore rely on the information we get from the members of our own group, from the members of the other parties who had the privilege of attending the meetings of the United Nations, and the speeches which were made by the Secretary of State for External Affairs.
When I read the speeches of the Secretary of State for External Affairs, I am somewhat impressed as I am also when I listen to those members who attended the United Nations, and I am convinced that the situation is quite serious. For instance, at one place in Hansard, at page 60, the Secretary of State for External Affairs is reported as follows:
In conclusion, Mr. Speaker, I return from Asia to our own western and north Atlantic world. Here we are now entering the period of greatest danger in the months ahead.
Then he goes on to emphasize the seriousness of the situation when he says:
If we do not, but give way to smug complacency on the one hand or unreasoning panic on the other, we shall become, and deserve to become, slaves ourselves.
Those are grave words of warning to which we must all give a great deal of heed. When one hears, on the one hand, the words of complacency uttered by the Prime Minister, to the effect that he does not expect a war in his time and, on the other hand, has the grave words of warning of the Secretary of State for External Affairs, one wonders just how one can reconcile those two frames of mind in members of the same party and, in fact, members of the same cabinet.
I think that the action the government is now taking, although it is late, will result in a great deal more of preparedness. With that I think we shall have to be content. But speaking of preparedness, I have some views on the matter and I want to mention a few of them. If a war does break out-and I use the word "if" advisedly-it seems to me that we should not be in quite the same position as we were in 1939. In my estimation, one of the best ways to be prepared is to have a national registration. This is not something new. I think almost every organization in Canada is asking for that action. Certainly the veteran organizations of Canada are asking for it, and those who are the heads of the veterans' national organizations have had some experience in this field. In order to carry on efficiently national preparedness, it would seem to me that national registration is the first step in order that we shall know the place in which every man and woman in this country can best be fitted. When the first world war came upon us, we had time to prepare. Everyone told us that when the next
war came, if it did, we would not have any time to prepare, that it would come overnight, in fact. Such is not the case. We have the warning from the Secretary of State for External Affairs, so we can be thankful for that. We should take advantage of the opportunity and should have a national registration under way immediately. We should know where every person fits in agriculture, in industry and in defence. In agriculture we should know just exactly what commodities we are going to require and in what abundance. In industry we should know what industries are capable of producing those materials which they can produce most efficiently in their plants. In defence we should know for what service men are best suited, whether for the army, the navy or the air force. I want to congratulate the Minister of Labour (Mr. Gregg) on his foresight in this regard. He is coming nearly to a national registration when he speaks of a national advisory council which he was given authority to set up under P.C. 567 and which I think is now under way. I think it was a good step to take, with regard to that national advisory council which the Minister of Labour says he is going to set up, to provide that there should be four representatives from labour, four representatives from employers, two from agriculture, two from the women of Canada and two from the veterans. I think that fairly thoroughly covers all the different fields in this country. I hope there will be good results from that national advisory council. But the success or the failure of such a council depends entirely upon the efficiency of that organization, on the completeness of their tabulation and on the records being kept of that tabulation. But I do not think it is sufficient to have a national registration and merely leave it to manpower as the proposition under the Department of Labour would suggest. I think that it must be a thorough canvass not only of industry but of finance as well.
When we came to this session there was one subject with which all members of the House of Commons and the people of Canada were concerned. I believe it has been mentioned by every member who has taken part in this debate on the address in reply. I refer to the cost of living. Despite this fact however the government seems to be most reluctant, and seems to be doing a little more shadow-boxing in telling us how it is going to cope with the problem.
This afternoon I listened carefully to the Minister of Trade and Commerce (Mr. Howe) who, I thought, gave an excellent account of the manner in which moneys were going to be spent for national defence, and for the procurement of munitions and supply. But

The Address-Mr. Johnston when it came to dealing with economic problems he did not seem to be so sure of himself. He spoke of the method1 that would be used to bring about controls, and indicated that the chief emphasis would, be placed on monetary control. I cannot imagine what control in that field he had in mind. However, if he was thinking of the remedy suggested by the hon. member for Fraser Valley (Mr. Cruick-shank), that the only way controls can be handled is by taxation, then I think he will fall far short of completing the task. In my judgment prices cannot be controlled by taxation alone. That has been tried; it is not something new.
For instance, the other day the Minister of Resources and Development (Mr. Winters) referred to tightening loans on houses. Well, the tightening of loans on houses is certainly not going to lower the cost of houses, nor will it lower the cost of materials. It may lessen the scarcity of supplies, but it certainly will never affect costs. The same is true of the government's plan for curtailing credit buying. It will stop buying just as effectively as the procedure outlined by the minister will stop the building of houses; but in neither case will it lower prices.
That is evident from the fact that, while we have had a tightening of credit buying for some months, during that time we have had additional increases in prices-to such an extent, in fact, that it has become extremely alarming. Yet the government seems to rely upon this old procedure that it has been using for months, knowing that it cannot be very effective.
I do not think there is anyone who believes in free enterprise who favours controls just for the sake of controls. Certainly the Social Credit party does not. But we also believe that when it is necessary to have controls initiated-and in my judgment it is necessary now-there is no use for the government attempting to attack a problem by simply talking about it, and continuing to talk about it.
As was said so well this afternoon by the hon. member for Acadia (Mr. Quelch), this idle talk by government officials about putting in price controls, or the probability of having price controls, is one of the greatest factors in driving prices upwards. That is exactly what is happening.
When price controls are put into effect I believe there should be a complete coverage through not only price controls but wage controls as well. There should be an immediate freezing of wages and prices, and then a proper adjustment made of both. I do not think any fair-minded person would say that we could have an over-all system


of price controls without having some form of wage control. Indeed, I do not think labour itself would expect that. Anyone must realize wages form a substantial part of cost, and must therefore enter into prices. However, I shall deal with that later on.
May I add in all kindness to both the hon. member for Fraser Valley and the hon. member for Broadview (Mr. Hees), who immediately preceded me, and who spoke about controls, that neither of them said how they would bring about those controls. They spoke only in generalities. One has to be somewhat more specific when applying the principle of price controls. The Social Credit party has always taken the position that when they make suggestions in this connection they have a plan to apply, and I shall outline it as we go along.
This afternoon the hon. member for Acadia told the house how controls could be instituted. It seems to me there is a great need for them. Every member in the house has received hundreds of cards from different organizations.


An hon. Member:: No.


Charles Edward Johnston: I have a pile of them now which must be at least three and a half to four inches thick. They come from all parts of my constituency. I have gone over those cards carefully to ascertain the distribution and I can tell the house that they come from every part of my constituency. The names on the cards represent every industry and every form of occupation in my riding. They come from the railway workers in Calgary, from the oil workers in Calgary, from the ordinary workingmen in Calgary; they come from the farmers throughout my district and from the miners in the Drumheller area. Every part is represented in those cards.
So it cannot be said that it is just a concerted effort of labour, of agriculture or of any other group to send out cards. When we see a coverage as broad as that, we can say that the people generally are very much alarmed about soaring prices. They are. Members of the house are, too. We are all concerned because the prices are going up continuously.
I have here a clipping from the Ottawa Journal of February 2 headed "Living Costs Zip Yet Higher Into Wild Blue Yonder," and stating:
The official cost of living index rose 1-4 points in December to a new high of 172 5 from 171-1, the bureau of statistics reported today.
All groups surveyed showed increases. Prices were higher for meat, butter, vegetables, fruits, men's wear, furniture, blankets, carpets, telephone rates-

They should have included freight rates, too.
-laundry, coal, health care, barbers' fees, gasoline, street car fares and newspapers.
It was the tenth jump in the prices barometer in the twelve months of 1950. The index is based on 1935-39 prices equalling 100.
Yes, it was the tenth rise in 1950. When we see prices soaring to that extent, and as rapidly as that, is it any wonder the people are so much concerned about it? Yet everyone seems to be cautious about what steps should be taken.
Let me read another extract along the same lines. It indicates the great concern of different classes of people in this country over this question. I intend to quote from the Ottawa Morning Citizen of February 7 an article entitled, "The Wives Speak", by Jack Scott. His first reference is to a barrister, although I did not think that barristers were financially embarrassed. He states:
A barrister writes that "to live with any degree of modest comfort costs us $350 a month and any saving is out of the question."
I put that on record to give some idea of just what is necessary for people to live in any form of modest comfort. As is indicated, you cannot do it for less than $300 or $350 a month. But that is not the class with which I am concerned most. One woman whose husband makes $50 a week writes:
We have a family of two boys and just manage to get by on his salary by living like hermits and cutting our food to a minimum. I dread to think of how people who make less than this are living.
Then another woman writes:
Have you ever tried to live on $77 a month, feed two children, clothe them, keep them warm and house them, and try to keep up appearances? It's only believing in God and the innermost spiritual belief that keeps me carrying on.
As the writer states, many of the letters are downright tragic. The article continues:
There is the woman whose husband is a bus driver. They have two children. Her husband's take-home pay is $72.50 every two weeks. They have found it impossible to make ends meet on this salary and are forced to sell the small home they built together.
"When I look at the house," she writes, "I think of all the nails I've hammered, all the rocks I wheeled for the drains, the roof we worked so hard on, the cold and wet, the laughter and tears that went into our home. We love it. It is our home. But it is for sale.
I'm tired of counting every penny, of telling the children, 'We can't afford it,' of not being able to go to a show or go bowling, of buying soup bones and not roast, of walking instead of riding the bus, of no holidays.
I am just so damned tired of existing and not living."
That is what that woman writes and I do not blame her for using the language she did. I have heard some members of parliament use stronger language than that in referring to
The Address-Mr. Johnston the cost of living. I think they too are justified. If you want to really hear what people are saying just go out into some of the farming and mining districts. Then you will hear what is really being said about the high cost of living. It is time that this government did something definite and concrete in regard to the cost of living.
We heard the hon. member for Fraser Valley (Mr. Cruickshank) say that probably the best way to take care of this is by taxation. Let us consider some of the causes for the increase in the cost of living. One of the most important causes is government taxation. When the government decides to put on a, direct tax everybody knows of it when they look at an article or buy one; they know that the tax is causing an increase in the cost. When the government increases income tax, that depreciates the purchasing power with a resultant decrease in the standard of living. There should be no reduction in the income tax exemption level. Two thousand a year or $166 a month is little enough for a married person to have in order to eke out a living with present day high costs.
Indirect taxes should be done away with because that is just a subtle means of reducing the people's standard of living without their being thoroughly conscious of it. It is idle for the government to talk about their going to do something when it becomes necessary, because that it just another direct way of increasing costs. There is no doubt that when a business concern hears about the possibility of controls they begin to raise their costs in anticipation.
The second reason for the increased cost of living is the large profits being made by industry. I do not refer to all industry, but the greater part comes within this category in the last few years. I should like to place on the record details of some of the profits that have been made. I am not one of those who do not believe in profits. I do not think anybody can carry on a business without profits. I do not think labour can exist without profits in the form of wages because that is what they are. Certainly no farmer could carry on without profits. But there is such a thing as excess profits, particularly in these trying times when living costs are so high. I should like to quote from the Labour Research of December, 1950, as follows:
Profits are at or near an all-time high. In 1949, total corporation profits after taxes (DBS) were $1,241,000,000. This is $18,000,000 below the 1948 figure, but there is every indication that 1950 will more than make up this difference. Financial statements of 38 companies with fiscal years ending August 31, 1950, and later, summarized in the Financial Post, show an increase of $7,314,409, or

The Address-Mr. Johnston 12-7 per cent over 1949. Even if the percentage increase in 1950 total profits is only half as large, this would' bring the 1950 total to about $1,320,000,000, or 75 8 per cent above 1946.
You do not mind people making a profit, but let us not kid ourselves about the huge profits that were made during the last war. We heard it said in this house in 1939 that there would be no blood money made in the war. What a lot of rubbish. You only have to look around the country to see the way industry has prospered, to know that there was a lot of money made during the war. In my opinion that was blood money. Something must be done or we are going to follow exactly the same track.
I spoke a moment ago about wages forming a part of the cost which enters into prices. If we are going to have price control it must be brought in immediately and there must be a levelling off of prices. Wages must form part of that levelling off process. First of all, there must be a parity set for prices and then wages must be set in fair relation to that. Whenever there is an adjustment in price, there must of necessity be an adjustment in wages.
One of the reasons the labour unions have been compelled to fight for higher wages is that they knew without question that prices were going to keep soaring and soaring and, if they did not fight for an increase in wages for their workers, those workers were going to be in a mighty tough position as a result of the high cost of living. So they have been compelled to take that action, but wages have never kept up with prices. The only way you can ever have a reconciliation between this ever-increasing cost and wages is by having a fair price set, and then having wages tied to that.
Then there is the low income group of people, even below the tax exemption of $2,000 a year. There are the old age pensioners. I agree one hundred per cent with what the hon. member for Fraser Valley said a while ago. He said that it was a disgrace and a shame to ask any of our people to live on the sums that they are receiving by way of pension. Imagine an old age pensioner having to rent a house and get a little meat at 98 cents or $1 a pound on an income of $40 a month. I do not see how those people exist. When it is necessary we can raise billions for other purposes, so surely we can raise a few paltry millions, if necessary, to help people in the low income group.
It is not only those living on pensions who are in the low income group. There are many people in the civil service who are in the low income group and need assistance. They

have not sufficient to make ends meet during this period of high prices. They should also have some protection.
I remember speaking in the house on one occasion in 1939 after the war began and pleading with the government to decentralize industry. The danger of attack was great then. At that time our industry was centralized in the two provinces of Ontario and Quebec. Much as it might be desirable to have a centralization of industry in those provinces, it is certainly not in the interests of the defence of this country, and particularly in the next war if there should be one. With the tremendous destructive power available to our enemies, it is not in the interests of the nation that our industries should be centralized in Ontario and Quebec. There is no reason in the world why we could not disperse our industries. Take the province of Alberta, and I am only using it as an illustration. We have tremendous quantities of oil and tremendous quantities of gas. We have an unlimited supply of coal and lots of raw materials. There is no reason why we should not be concentrating on the development of heavy industry, not light industry but heavy industry, in the province of Alberta. It would be much safer from attack.
I venture to say that our industrial potential could be almost ruined overnight as the situation stands today with our industries centralized in two provinces, and in just a portion of those two provinces, mostly in Toronto and Montreal. When you think of the tremendous destructive power of the atomic bomb, how long would it take to put us out of commission? How long would it take to ruin us as one of the great suppliers of munitions and supplies? Even in Russia they have recognized this problem and have gone to great pains to rectify it. They have not concentrated all their heavy industries in the large centres. They have dispersed them throughout the whole country, away out in the mountain areas for protection from their enemies. Yet we have not seen fit to do that. I have not time to expand that subject as much as I should like.
I want to say a word about highways. I think we should make every effort to develop a trans-Canada highway system, and that it should be done immediately. I understand that the Minister of Trade and Commerce recognizes the importance of motor trans-portatior. in Canada. I am given to understand that when the motor transport delegation met the Minister of Trade and Commerce not long ago-I think it was last summer-he gave them assurances that
21S

The Address-Mr. J. M. Macdonnell
priority would be given for motor transport replacements and the maintenance of such transport. I am sure he recognizes that in case of an attack on this country our railways could be put out of commission very readily, and it would be some days, weeks or maybe months before they could be repaired sufficiently to be of any use again. Motor transport could be operating again in much less time. If they were damaged the highways could be repaired in a matter of hours or days. I think every effort should be made to see that the trans-Canada highway system is completed at the earliest possible moment.


Mr. J. M. Macdonnell (Greenwood):: Mr. Speaker, it gives me more than the usual pleasure tonight to congratulate the mover (Mr. McMillan) and the seconder (Mr. Breton) of the address in reply to the speech from the throne. The mover happens to have the great good fortune to be a graduate of Queen's university, Kingston, of which I also am a graduate, and it gives me hope. When one looks at the serried ranks opposite and also to the right, one always has hope that here and there the light of reason may break through and effect a conversion. Of course when it is a fellow graduate of mine-although I am afraid he is not in the chamber at the moment-my hope is greater. With respect to the seconder of the address I should just like to say in my very indifferent French that I thought he did well. 11 a gagne ses epaulettes!
Since we arrived here we have been discussing very largely dangers from outside, and indeed they are worth discussing. They are serious enough. I wish tonight to take some time, Mr. Speaker, in discussing the great danger at home, which we also have been discussing, the danger of inflation. Inflation has been described very simply, more simply than I thought an economist could ever describe anything. It is described very simply by an economist called Kemmerer. He says, "Inflation is too much money and deposit currency"-simply that.
I am not going to weary the house by going over ground that we on this side have gone over a good many times in the last five or six years, pointing out to the government how they have been constantly keeping the fires of inflation going. I am not going to weary the house by giving figures which have been given so often-that the means of payment have multiplied about four times while goods and services have multiplied about twice. I am not going to count up the many times we advised the government to free the dollar before they did it, and try to compare the many times we have told them to stop inflating it, because it might be that I might lose
hope. If I did that I might find that we have said the one ten times and we have only said the other five times, and therefore we have got a long time to wait. At any rate it has been much discussed, and now for the first time I think people are beginning to consider that it may mean them. For the last few years our tendency has been to think of inflation as a funny thing that afflicts far off, funny people who do not know how to look after their own affairs. We have had a very simple phrase that has come to us from Britain, about "too much money pursuing too few goods."
I am not going to weary the house with a description of inflation elsewhere, because I do not think it is necessary. I only remind hon. members that after the first war there was inflation not only in Germany, where there was some suspicion they might be wanting to inflate in order to escape their debts, but in France, thrifty, hard-working, saving, hard-headed France. By 1926 they had suffered such a degree of inflation that their franc had gone down to about one-seventh of its value, and it was only by herculean courage and energy on the part of Poincare that it was rescued at that time. Since then, of course, it has gone infinitely lower. I was in Paris last summer and for a very modest breakfast at a curb restaurant one paid 200 francs, which was the equivalent of about 60 cents Canadian; and it was sad to reflect that when I was first in Paris, 200 francs would have been worth $40 Canadian.
Now just a word about the situation here. We are under pressure; we all know that. I am not going to worry you with figures, because we are all familiar with the situation. However, I do think we should remind ourselves that really the pressure is just getting well under way. I suppose that with the people who will be engaged on war orders, plus the people who will be required for the various armed services, plus the people who will be required to supply materials for the armed services, one would not be exaggerating if he said that within a year or eighteen months from now perhaps ten per cent of the present working force will have been diverted from the production of consumer goods. I am not going into the question of the tremendous capital investments facing us, to which the Minister of Trade and Commerce (Mr. Howe) referred this afternoon, but I do wanit to comment on one point. I would be the last person to suggest that it would have been simple or easy to have prevented it, but it is bitter irony that in spite of the glowing figures the Minister of Trade and Commerce gave us this afternoon about our exports and imports, our investments and our production of all kinds of things-all of

The Address-Mr. J. M. Macdonnell which was interesting and impressive-nevertheless to an extent we hate to admit we have here a kind of "poverty in the midst of plenty". We know that, and it is a very unpleasant thing to reflect upon.
I want to say just a word more about this easy money before I pass on. It has been said before, but frankly it does not seem to me that the lessons have all been learned yet. I have here an editorial which appeared in the Winnipeg Free Press of November 18 entitled "The Big Blunder". The blunder they describe is a blunder we on this side of the house have tried to describe. It is that in the year 1945 an excellent tool was devised and put forward in a white paper for dealing with a depression, and it was used for five years to deal with boom conditions. That is what the Winnipeg Free Press describes as the big blunder, and I shall read a paragraph from the editorial, which describes ini some detail what has been happening. It goes on to say:
Toward the end of the second world war the governments of all free countries expected peace to bring a major depression unless they could head it off.
I would be the last to blame them for that; I think what was done at that time was a very proper precaution; but I quote again:
The great blumier was made in Washington, but the government of Canada cannot escape its share of responsibility. It, too, misjudged the economic current, was haunted by the fear of deflation and announced boldly in the famous white paper issued in the spring of 1945 that it would use every means of heading off another depression.
It did use those means year after year, I suggest, in spite of everything that could be said. That is what you might call the public inflation; but there was a little private inflation, too.
I want now to refer to the inflation that took place last autumn, connected with our freeing of the dollar, when we added another $200 million of naked inflation, that is to say money without anything to represent it. Again I shall quote the Free Press, feeling that it probably will be taken on the other side of the house as an authority of some value:
The government was compelled to make new money to the amount of $200 million . . .
That was to satisfy the demand of the United States investors in Canadian dollars.
This money was borrowed from the private banks on short term paper, which meant in fact that it was created by a fountain pen. At a time when the money supply was too big it was swelled by $200 million overnight.
That brings us to the session of last autumn. I would not want to blame people for not foreseeing things I did not foresee and probably no one else foresaw, but we did not need an awful lot of foresight last


September to realize that we were getting in a tough spot. It seems to me it is fair enough to complain if there was any neglect of serious restrictive credit measures beginning last September. As I look back now, indeed when we considered matters last September, there did not seem to be any sense of tremendous urgency. The government did this and did that, but there was no great sense of urgency, and today we are reaping the result.
That brings me to the speech this afternoon by the Minister of Trade and Commerce. The part with which I wish to deal is the last part, in which he spoke of inflation, or prices, or price control. I suggest that a newspaper man might headline that speech something like this:	"We have missed the
bus. We are too late. Prices have got away from us. The inventories have been built up. We must just wait and see, and hope that the United States may help us out of our trouble." I shall try to satisfy you that this is a fair summary of some of the things, at any rate, the minister said this afternoon.
Let me review some of the chief points of his speech. He asked us to believe that fundamental governmental inflationary policies, as he called them, have been vigorously pursued. I wish I could think they had; that is what the minister said, and I shall quote his words:
We must continue to pursue fundamental antiinflationary policies as vigorously as ever.
Note the words "as ever." Let us have a look at the vigour. Can anyone tell me what has really been done since last September to halt inflation? I should like to know. First of all let us take bank loans. If it wishes, the government can. have something to say about bank loans. We have a central bank; we have all kinds of powers and influences and suggestions that can be made, but let us look at the bank loans. They are pretty good evidence of what is going on in the way of credit expansion. We find that current loans were up something like $300 million in the last six months of the year; and I believe that is an understatement. I have not the December figure, and I think it is more than that. I do not blame the banks. They cannot conduct a gestapo. If they have a credit-worthy borrower the bank cannot say, "What are you going to use this for?". You cannot even blame the borrowers, because after all these people are in business. If everyone else is buying and putting up the price and they do not buy, they will go out of business quickly enough. The people to blame are the people at the source of credit, the people supposed to guide our credit policy, the Department of Finance and the Bank of Canada. But,

The Address-Mr. J. M. Macdonnell
as I have shown, last autumn the Bank of Canada and the government were busy injecting $200 million more credit of their own into the system, without trying to curb what was being done at that time by the banks.
As a matter of fact it seems to me that since last September everything has been going wrong. We have had any amount of talk, really too much talk, but precious little action. What was attempted last autumn? The only thing I can remember in the way of credit curbing was in connection with instalment buying. I have to admit that I have not been able to get the actual figures. But my impression is that they are not very large. In any event, I say without hesitation that so far as they have had an effect on the over-all credit situation, they have been as much good as a bucket of water on a three-alarm fire.
Now, the truth of the matter is that the government has been wholly inactive, but the purchasers of commodities have not been inactive. They have been on the job. The Minister of Trade and Commerce makes that very clear. I must say that he was very fair in a lot of the things he said this afternoon, and I thought he was surprisingly frank.


Mr. Gillis:: Will the hon. member permit a question?


James MacKerras Macdonnell: Yes, certainly.


Clarence Gillis: I believe the hon. member
made a statement a moment ago which I should like clarified. I thought he said that the Bank of Canada and the Department of Finance controlled the issuance of currency and credit through the chartered banks of Canada.


James MacKerras Macdonnell: I did not
say that. I said that the Bank of Canada and the Department of Finance could exercise over-all control over the credit of this country.


Mr. Abbott:: How? I should like the hon. member's view as to how we could do it.


James MacKerras Macdonnell: I am not
going to get involved in that. We have been told many times, and we all have evidence of it, as to the influence of the Bank of Canada. No knowledgeable person in this house doubts that, least of all the Minister of Finance.


Douglas Charles Abbott: I did not know whether you thought the Bank of Canada might approve the bank loans?


James MacKerras Macdonnell: No, and I
stick to what I have said without hesitation. The Bank of Canada and the Department of
Finance can exercise a very great influence over the banks if they wish, and they constantly do. Everyone in this house knows that has been done.


Clarence Gillis: I should like an answer to that question, if I might interrupt.


James MacKerras Macdonnell: I have
answered the question. Will you allow me to go on with my speech, please? I am not going to permit any more interruptions.


Clarence Gillis: That is quite satisfactory.


James MacKerras Macdonnell: You can come and give me a private audience afterwards.
I should like to quote again from the minister's speech. Comparing the situation today with the price ceiling in 1941 the minister said:
At this time many people expect the reimposition of the same kind of controls and are governing themselves accordingly.
The minister did not leave us in any doubt as to what he meant by "governing themselves accordingly", because he added that they were "all set." I believe that phrase is unfortunate. I do not believe for a moment the minister intended to create the impression that these people were trying to profiteer from the rest of the community. I still think that is the impression which one was inclined to get. Furthermore the minister did talk throughout his speech more or less as if he were talking about the "economic man", and not about a lot of men and women of flesh and blood who are today suffering from the evils of high prices.
I want to go on to say that my guess is that when the Korean situation quieted down in September, October and November, the government thought they were pretty well out of the woods and took a bit of an "easy". Indeed it seems to me that they have rested on their oars.
I believe that the minister's next comment will give very cold comfort to those who are in trouble. He said:
The upward pressure on prices both in Canada and abroad was much less severe in 1941 than it is now.
In other words, conditions are worse, so we do nothing. It seems to me that is implied in that statement. There is the implication too that, not only is the pressure high now, but it is certainly going to be higher.
Then the minister did give us one bit of comfort which I hope may prove to be substantial. He suggested that a good deal of the demand was what he called anticipatory, and I can hope and believe that may be true and that it may have its effect later.
The next thing the minister says is:
I am not ruling out the possibility that sweeping price control measures will be needed, should the

The Address-Mr. J. M. Macdonnell developing situation make action necessary, but it may well be that these measures should be different in form from those that were applied during the last war. Alternative measures are now under active study by the government.
Mr. Speaker, I cannot imagine, and I do not believe anyone else can imagine, anything that is more likely to fan the flames than that statement by the minister, because it seems to me that the very motives which have been driving people to anticipate their requirements, to buy in a big way, will be stimulated further by what the minister said. As a matter of fact, it seems to me that the minister has almost opened the door and that, to use his own words, presumably the people will govern themselves accordingly.
The minister said one other thing to which I want to refer. He spoke about the United States and said:
We earnestly hope our American neighbours will succeed in attaining a reasonable measure of stability . . .
At a later stage he said:
I do not suggest for a moment that we can relax and let the United States solve our economic problems for us.
That, of course, I take for granted.
Then, as I sum up what the minister said this afternoon, it seems to me I can imagine the ordinary citizen saying that the speech delivered by the Minister of Trade and Commerce this afternoon is proof that this thing is going to continue, and indeed is going to get worse. It seemed to me that was the implication in it, unless he has some secret knowledge that none of the rest of us have, and which he does not feel he can divulge.
How long is the great mass of citizens going to stand by and be content with this? The ordinary citizen is not fully informed.
I have before me a speech delivered by Donald Gordon from which I should like to read one sentence. He said:
During the last war this country resorted to widespread controls over prices, wages and physical production and distribution, such as rationing and allocation of available supplies, et cetera. But the relative success of these measures in the midst of a total war for survival should not be taken as proof that the same results could be achieved in the quite different environment of today.
Even if the ordinary citizen reads that address of Mr. Gordon's and feels that since Mr. Gordon knows so much about this subject it is rather dubious that the same measures could be used again, and even if the citizens knew the caustic comment of Mr. Kenneth Taylor, for whom we all have the greatest respect, that price control was like


"trying to cure a fever by fixing the thermometer", nevertheless they would find later in Mr. Gordon's speech the following:
Runaway inflation is so destructive that any method of stopping it, no matter how difficult and clumsy it may be, is surely the lesser evil.
I am afraid the ordinary citizen would be inclined to think that, from his point of view, inflation looks mighty like a runaway inflation. I am not saying it is runaway inflation, because I believe the good sense of Canadians, if properly led, would stop it. Still, I would not be surprised if a good many people would try to argue that it is. The minister himself, of course, speaks of the upward pressure of prices being less severe in 1941 than it is now. In other words, he leaves the impression of a great pressure. He leaves the impression of action still delayed, and to me it seems he gave no reason to suppose, except perhaps the one I mentioned of the excessive anticipated demand, that there would be a turning back.
One other remark the minister made was that alternative measures are now under study by the government. He refers further to a more comprehensive price control bill. Now, if this continues much longer it seems to me we will just be wasting our breath in asking the people to believe that the cure is more production and less spending, though I firmly believe in both. There is not much use in telling people who have not enough money to spend now that they must do less spending.
I also do not believe that controls stimulate production, except in very special and temporary circumstances. I am not telling the government what they shall do. But it seems to me that up to the present time, particularly since last September, they have certainly missed the bus and failed in what should have been done. The minister talks as if there was time to wait while fiscal control measures and, I presume, taxation policies and credit control have their effect. I wish that I could feel he is right, but his speech has definitely increased my concern. What I fear is that they have waited too long; and1 in the light of the minister's speech, I think every day makes it more difficult.
I believe in credit and fiscal remedies. I believe they are better because they are more pervasive, more economical, more democratic and because they do not need a whole army of controls. But unless some fortunate turn of events comes along, I feel that the demand for some other kind of measures will grow and become so strong that it cannot be resisted. Again I say that I am not telling the government what to do. I am pointing

out that what they have done has been destructive and not constructive. I hope that other remedies can be found, as the minister implied. But meanwhile I reiterate that at the moment I think the ordinary citizen will feel that he has asked for bread and has been given a stone.


Clarence Decatur Howe: May I ask my hon. friend one
question? If he places such a high value on controls, why did he spend the years 1946, 1947 and 1948 demanding that they be done away with?


Stanley Howard Knowles: Why did the government accede to that demand?


James MacKerras Macdonnell: If the minister had done me the honour of listening to me a little more carefully, he would have known that I have not demanded controls. I have said that I am afraid there will be an overwhelming pressure for them, unless other remedies, which the minister talked about and which I said in my closing words I hoped were still an alternative, could be made effective much more quickly. I made that clear; as least I tried to do so.


Clarence Decatur Howe: But you did not believe in controls at all.


Douglas Charles Abbott: I could not tell what the hon. member was asking for.


Mr. Charles Cannon (Iles-de-la-Madeleine):: Mr. Speaker, I wish to add my congratulations to the well-deserved compliments that have already been paid to the mover (Mr. McMillan) and the seconder (Mr. Breton) of the address in reply to the speech from the throne. I listened with interest to their remarks and I agree with those who have already said that they both are valuable additions to this house.
During this debate, which has dealt at length with foreign affairs, I have not heard any member of this house mention the magnificent effort in Korea of our great neighbour and ally, the United States of America. But I have read the remarks of the hon. member for Beauce (Mr. Poulin) on the subject of what he calls American imperialism. I wish to pay tribute to our gallant American ally who, singlehanded at first, went to the help of the republic of Korea. This admirable action may be compared to that of England and France going to assist Belgium in the first world war or to assist Poland in the second; but it is not the same kind of gesture from a historical point of view. It is the first time in the history of the world that a great nation has gone to war to implement its obligations under a collective international covenant to
The Address-Mr. Cannon outlaw and punish aggression wherever it may take place in the world. I salute this great nation that, from idealistic and altruistic motives, has sent her sons to fight a cruel and difficult war; and I decry and deplore the accusations that have been made in this house that the United States' intervention in Korea is based on imperialism and selfish motives.
The hon. member for Beauce made his remarks in French the other day; and as I wish to answer them, I am going to read from the English translation of his remarks which appears in Hansard of February 6. This is what he said:
The monstrous war budget of $87 billion introduced by the American government and Canada's defence plan calling for an expenditure of $5 billion lead us strongly to believe that a general war is in the offing. The fabulous expenditures, I will be told, are designed to prevent war. As was done last September, the old saying si vis pacem, para bellurn, if you want peace, prepare for war, will be invoked. But history proves this saying to be false; conquerors have always used it as a sham to hide their infamous designs for conquest. History is repeating itself once more.
I may say that evidently the hon. member for Beauce had not learned anything from the experience of the free and democratic nations at the beginning of the second world war when they were caught unarmed and when it took them two to three years to get together the armaments needed to wage a victorious war. I am sure that hon. members of the house will agree with me when I say that the old saying is still true and that the government of our country is right in saying that if we wish to avoid war, we have to arm. The hon. member for Beauce goes on to say:
Besides, we all know that this saying was coined by these same people, these same imperialists who preached a preventive war of conquest with these words: delenda est Carthago, Carthage must be destroyed.
The Roman empire then wanted, in the name of peace, to cross the Mediterranean and destroy the very foundations of the African empire. Today the American empire is picking up the torch from the failing hands of the British empire and wants to cross not only the Mediterranean but the seven seas and use guns, tanks and flame throwers to make the Asiatic people benefit from the blessings of peace. And they want to drag Canada into the venture; We are already taking part in the undertaking as members of the Atlantic pact organization that has been set up.
To put it mildly, that is not according to the facts. To say that the United States of America has gone into this war from imperialistic motives or motives of conquest is to make a remark so far from the truth that I feel it should not be allowed to go unchallenged in this house. In the interests of the friendship and understanding that have always existed between our two great countries, I feel that we in this house should,

The Address-Mr. Cannon through my humble voice, express our disagreement with these remarks and our appreciation of the magnificent effort of our American allies in Korea. Again, to put it mildly, Mr. Speaker, these remarks to which I have referred are misleading.
It is the duty of the representatives of the people in this house not only to represent the people but to give leadership. In order to give leadership you have to tell the people the truth. With all due respect, I say to the hon. member for Beauce that in talking in the way he has, accusing the Americans of being imperialistic conquerors, he is using the communist line from Moscow. The best answer to the contention that the United States of America had those intentions is that they withdrew the last of their occupation troops from Korea just a few months before the attack on South Korea took place. If they had had any imperialistic or conquering designs on Korea, they would certainly not have withdrawn their troops just at the time they did.
Canada is taking its part in this action and we have been warned in the speech from the throne that we shall be asked to authorize Canadian participation in the European force to be organized under the north Atlantic pact. When I had the honour of proposing the address in reply to the speech from the throne at the last session of parliament I said, as reported at page 85 of Hansard of August 31, 1950:
This is also the first time that Canada has been called upon to honour Its signature to an agreement to give armed aid to another nation. Are we going to honour our signature? I say, yes. We are not going to tail this first test; and I am sure this house will also answer the question with a resounding yes, authorizing the government to send the special force to Korea or use it to fulfil any of our other obligations under the United Nations charter or the North Atlantic treaty.
The house at the last session gave to the government authorization to send fighting men to Korea, and I am sure that at this session it will authorize the sending to Europe of sailors, soldiers and airmen to fulfil our treaty obligations and to forestall war-because that is what we are doing. We are arming to forestall war and to preserve the peace.
I wish to congratulate the Prime Minister (Mr. St. Laurent) upon his courageous and straightforward statement on national selective service. As reported at page 28 of Hansard, he said:
So far there has been brought to my attention nothing that would indicate that the institution of national selective service at this time would be beneficial. On the contrary, the information we have obtained is that it would hamper what is being done at this moment. Now. that does not mean that the situation cannot change, and it does not mean that if and when it does change there

will not be changes in the manner in which our resources will be contributed to this pool of international strength.
I am of the opinion that universal conscription for military service would not be a good thing for this country. It it were applied it would not leave us enough men to reap full benefits from our agriculture and our industry upon which our friends and allies depend, as well as ourselves. But at the same time I deprecate the attitude of the hon. members for Beauce (Mr. Poulin) and Quebec-Montmorency (Mr. LaCroix) who said that they are against the sending of Canadian troops to Europe or Asia. It is now unanimously recognized that the first line of defence is in Europe. The United1 States themselves have promised to send several divisions over there, notwithstanding their commitments in Korea. I think that even the hon. member for Beauce will not accuse the United States of sending those divisions there to conquer Europe, as he has accused them of sending troops to Korea to conquer that country.
If the house and government were to listen to the hon. members who wish us to defend ourselves only at home, and not to arm the country as we wish to do, we would probably see this chain of events develop. If an enemy came to Canada, to my constituency of Magdalen Islands, or Halifax or Vancouver, these people would say, "It is none of our business; let us wait for them here. They are too far away. Let us wait until they come closer to home". If they came to Toronto it would be the same thing-they would wait until the enemy got to Quebec. And even when it got to Quebec city, if the enemy were in Lower Town and these people were in Upper Town, they would say, "Let us wait until it comes to Upper Town". This is a reductio ad absurdum of the theory of waiting for the enemy to attack us at home.
The North Atlantic treaty and our obligations under it are to defend us against communism. Let us not forget that. What are we doing to defend ourselves against communism at home? Although I have not yet expressed my views on that subject in the house, I am of the opinion that we have not done enough, so far. I welcome the reference in the speech from the throne to Canadian citizens who are not loyal to Canada. The reference is as follows:
Appropriate amendments to the Canadian Citizenship Act will be introduced to prevent the retention of Canadian citizenship by persons who have renounced their allegiance or shown by their conduct that they are not loyal to Canada.
I believe that the enemy in our midst is even more dangerous than the enemy beyond our frontiers. I think that methods should

The Address-Mr. Sinnott
be taken to suppress the communist party and to ferret out and punish those members of it who are dedicated to the forcible overthrow of the government and to deprive us of our liberties and of our way of life.
Patrick Henry once said these immortal words: "Give me liberty or give me death". It is heroic to offer one's life to regain liberty once one has lost it, but it is more practical to take measures to protect it while we still have it. Those measures that should be taken are measures to outlaw and to suppress the communist party and communists in Canada. These measures, I say, are as important as those being taken to prepare our military defences.
The United States were founded on and dedicated to the principle of human and individual liberty; but they have taken steps against the communist party which we have not taken yet. With great respect for those who differ from me, I have never understood those who say that the communist party must not be outlawed because it would be driven underground. We can be sure that its plotting and its plans against our government and our way of life, and its nefarious deeds, are done underground anyway. They are not carried out in the open. I believe we should take steps to defend ourselves from this enemy who is in a position to gnaw at the very vitals of our country.
The speech from the throne also says:
Proposals were laid before the provincial governments for new tax agreements, and for a contributory old age pensions program along the lines recommended by the joint committee at the last regular session.
The provincial governments are at present giving consideration to these proposals and to proposals for constitutional amendments which may require to be submitted to you before the close of the present session.
As a member of the committee that studied old age pensions last year, I am very glad the government has made reference to them in the speech from the throne, and has indicated that steps are going to be taken to implement what was done. One opposition member has said that the government is delaying. I say it is far from delaying. It is taking the steps necessary to pass the required legislation at this session of parliament, if the provinces do their share in facilitating the necessary constitutional amendment.
I was very pleased to see in the newspapers today that the province of Quebec has declared that it is willing to do what is required to allow us to have old age pensions at sixty-five, and to implement the recommendations of the old age security committee. I think also we should underline the fact that the government is showing very great courage
in bringing in that legislation, notwithstanding the enormous expenditures placed on our shoulders because of the war effort to which we are committed in view of present international circumstances.
May I add my voice once again to that of other hon. members who have asked for a pension for invalids who are unable to provide for themselves. They should be helped. They have as much right to our sympathy and our help as have those who are blind.
These are the few remarks I wished to make in the debate in reply to the speech from the throne. In terminating my remarks I wish to assure our great Prime Minister of the continued admiration and loyalty of the electors of the Magdalen Islands, and of their humble representative in the house.


Mr. J. S. Sinnott (Springfield):: Mr. Speaker, it is with considerable reluctance that I, as a backbencher, have finally decided to take part in the debate. However, as the representative of the constituency of Springfield, which holds the key to all the industrial activity of Manitoba, and which supplies all the power to all of Manitoba, and as the member who in 1949 was re-elected with the greatest majority ever recorded in that constituency, I think it is my duty to place before the House of Commons the views of my constituents.
May I offer my congratulations to the mover and seconder of the address in reply. I also take great pleasure in the government's decision to appoint the hon. member for Edmonton West (Mr. Prudham) to the position of Minister of Mines and Technical Surveys. I am sure that his appointment will be most helpful to the government.
I find it gratifying, also, to note that the hon. member for Kenora-Rainy River (Mr. Benidickson) has been appointed parliamentary assistant to the Minister of Transport (Mr. Chevrier). I say this, not because his riding is next to mine but because his record in the House of Commons as a member has been one of great assistance. He served in another capacity in the second world war, and his record is unsurpassed. I am sure his added ability will be of great help to the government in these trying and troubled times.
I am sure it will also be proper to say that the appointment of the hon. member for Gaspe (Mr. Langlois) as parliamentary assistant to the Postmaster General (Mr. Rinfret) will be appreciated by the people of Canada as a whole, and particularly by the constituents of Gaspe. This hon. gentleman served a long and difficult period with

The Address-Mr. Sinnott the navy during the last war and suffered many more hardships than most people realize.
Then I must not forget the hon. member for Montmagny-LTslet (Mr. Lesage), who has been appointed parliamentary assistant to the Secretary of State for External Affairs (Mr. Pearson). He has shown a keen interest in former debates on foreign affairs and will prove of great value to our already famous minister.
It was also with great pleasure that I heard that the hon. member for Vancouver Centre (Mr. Campney) had been appointed parliamentary assistant to the Minister of National Defence (Mr. Claxton). Then we have our own prairie member, the hon. member for Regina City (Mr. McCusker), who has been appointed parliamentary assistant to the Minister of National Health and Welfare (Mr. Martin). I am sure that he will be of great help to the minister. The hon. member for Regina City is a "natural", as he served overseas as a medical doctor in both wars and has the record of having the personal ability to get things done.
I turn now to another field, something that is of great concern to us all, the question of national defence and all its ramifications. It is true that the amount of money required for our national defence forces and other Canadian commitments is of great importance, but it will be accepted by the Canadian people as a whole. At this point we must never forget nor neglect the magnificent and determined effort put forth by our navy in world war II. If it had not been for the determination of the navy to protect the soldiers and supplies which were crossing the many seas, the results might have proved to be different. I say to those inside the house and out that it would be well to review the official resume of the battles of world war II in a publication entitled "The Far Distant Ships" by Schull. I know it will have the effect of bringing home the importance of the part played by the navy in the last war.
It is true also that Canadian airmen are known the world over as being super in courage and determination and1 have always had the reputation of having done their job well. I must say also that Canadian soldiers were always faithful and courageous in whatever part they played and! are known the world over as real heroes.
I have said that all three services were important in the last war and each did1 a magnificent job, but there was also another group of men and women at home who did a large part in keeping the railroads and war plants going. Families worked long and tedious hours in order to keep the men at the front.

There are not many in this house who realize that a certain group of people called farmers sometimes find themselves to be not nearly sufficiently represented in the House of Commons. The number of farmer members is few in comparison to the other professions in Canada that are represented. When discussions on agriculture take place in the house few of the city members are interested enough to stay in their seats and listen to the debates and therefore they are at a loss to understand the problems faced by the farmer. I hope that in future more interest will be shown.
I come now to something that will have to be decided in the very near future, that is, the final payment on the four-year wheat agreement with Great Britain. It is the allimportant "have regard" clause, a clause which was inserted in the contract at the request of the British government, which we are all concerned about, the farmers in the west in particular. The government in Britain never thought for a moment at that time that wheat would be near the price it is today five years after the war. The "have regard" clause would have given them the great advantage of cheaper wheat had world prices dropped. But their calculations were not carried out and there cannot be too much emphasis on the part of this government that the government of Great Britain carry out the "have regard" clause.
Great Britain has obtained from Canada wheat and bread supplies over a period of five years. Many million bushels of wheat were purchased at prices considerably lower than average world prices. I repeat that the government of Canada must impress on the government of Britain that the "have regard" clause must be carried out. The western farmers and wheat growers cannot and will not be satisfied until a final payment of at least 15 cents per bushel over the five-year period is paid. This is a must; it must be forthcoming if we are to do justice to the wheat growers of western Canada.
I come now to another subject and in this I am repeating the plea I made in the last session of parliament, that something be done for the crippled people of Canada. Many of these citizens are far more deserving of a pension or federal help than many of those already receiving a pension. As reeve of a municipality I am in position to understand the heavy drain on municipal funds or taxes made necessary by caring for this class of citizen. It is beyond the capacity of the municipality to stand this strain. In 1950 it cost the municipality which I represent almost $5,000, which came wholly out of the pockets of the taxpayers, for this purpose.

Therefore, I strongly recommend that consideration be given by the federal government to granting a pension at an early date to these people. There are pensions for the blind, there are pensions for the aged; why not pensions for the crippled who are unable to do anything for themselves?
There has been a great cry from our C.C.F. friends across the house who have advocated a reduction in the cost of living. In my opinion, the C.C.F. cater to one class only, the industrial workers. Mention has been made in the newspapers about the 800,000 cards that have been received by hon. members. There are 47,000 people in my riding and I received 66 cards. Those cards have been coming from the industrial and railroad workers. I have not received one from a farmer in my riding.
The hon. member for Winnipeg North Centre (Mr. Knowles) is always clamouring for higher wages, more pensions and shorter hours. If the government were to carry out his suggestions, there would be few people in Canada working at all. This kind of propaganda sounds good to many of the voters, but if put into practice would have a demoralizing effect on the country as a whole.
Why are prices rising? Why are young people leaving the farms? There is only one answer-they are finding employment in industrial plants where there are shorter hours, better living conditions and higher wages. If this continues across the length and breadth of Canada the spiral of prices will continue higher. Farm products will be in increasingly scarce supply with a continued shortage of farm labour. Something must be done to encourage young people to stay on the farm. Big business in this country should take note of this fact and their profits should compare favourably with the incomes of the producer and consumer.
(Translation):


Mr. Arthur Masse (Kamouraska):: Mr. Speaker, it was not my intention to take part in the debate on the address in reply to the speech from the throne but, in view of its importance, I cannot shirk the obligation of freely expressing my opinion and that of my constituents.
In view of the tension in world affairs, I will make so bold as to draw certain comparisons between the present and the past.
May I be permitted to congratulate the mover (Mr. McMillan) and the seconder (Mr. Breton) of the address in reply to the speech from the throne. Their constituents must surely be happy to have chosen such representatives.
The Address-Mr. Masse
On looking at the international situation, the attitude of certain totalitarian countries comes not as a surprise but as a disappointment. On the other hand, the study of world history brings the realization that, at all times and in all eras, there have been conquerors who thought they could rule the world. I have in mind Victor Hugo's celebrated lines on Napoleon II, written when t'he latter thought himself to be master of the world's destiny.
What did all these conquerors gain from their conquests? A passing glory. And, more recently, what has followed in the wake of two world wars? Instead of looked-for happiness and prosperity, naught but misery, destruction, even the complete wiping out of certain countries. Even in this case, there is nothing new. After other devastating wars what became of once famous cities such as Babylon?
I must congratulate the government of my country for its sane attitude in seeking peaceful settlement of the conflict now plaguing the world. To my mind there are no better ways of relieving such tense situations than conciliation or negotiation.
However, without adequate defence preparations, it would be a mistake to leave the door open to negotiations. A strong defence acts as a check on those who crave for domination. The experience of the last war should make every Canadian realize that we should not wait till the last moment to make defence preparations.
I heartily endorse the stand taken by the Prime Minister of Canada (Mr. St. Laurent) in his statement in this house on the form of our war contribution. The immediate organization of our territorial defence and our civil defence seems to me very wise. Civil defence deserves special attention for, with modern transportation facilities, distance is no longer a consideration.
It is high time we prepared our civilian population to face any possible danger that may arise through no fault of our own but which we must expect all the same.
Our government's wish to share adequately in the Colombo plan pleases me very much, because if we give sympathy and hope to those distressed populations, communism will not appeal to them.
I am not one of those who think that the whole of Asia puts unlimited trust in the communist regime. I prefer to believe that the people of Asia accept that way of life

The Address-Mr. Masse in the hope that it will lead them to greater happiness than they have had before. They look to it as a last hope which, until now, has been denied to them under their own governments.
In Canada the government has substantially contributed to the people's welfare by legislation providing for such benefits as family allowances and old age pensions. I trust that the government will also take the appropriate steps to give adequate aid to the needy.
Because of those welfare measures, the people of Canada are more confident. These measures are in keeping with the traditions of my district because my people who were left to themselves on the shores of the St. Lawrence river two centuries ago have been the custodians of our principles and our tradition of mutual aid and fellowship since the beginning of the colony.
As the representative of an agricultural and lumbering district located on the shores of the St. Lawrence and extending to the United States frontier, it is my duty to request the government to maintain the help it has so far given our farmers, particularly through the Agricultural Prices Support Act.
Agriculture is the very basis of our production; to realize this, one has but to read "Canada 1950," at page 109. Consequently, it is necessary that our farmers get all the help and assistance they are entitled to. I am convinced that the more we increase production the sooner agricultural prices will find their normal level while allowing the farmer to draw a reasonable income.
I wish to congratulate also the Minister of Agriculture (Mr. Gardiner) for the task he has undertaken of finding markets for our farm produce. Thus, we may be able to keep on the land our young people who may be tempted to quit it temporarily for prospects of easier income.
It is also my duty to thank and congratulate the Minister of Public Works (Mr. Fournier) for the building of a soil research laboratory at Ste. Anne de la Pocatiere, that cultural centre in Kamouraska county. The laboratory will supplement the existing facilities at that experimental farm. This gesture shows how much the government has the interests of the farming people at heart. The future of the farming class is dependent upon


research and it is the duty of the state to provide the means of undertaking the necessary research work; it is a well-known fact that the progress of agriculture has too often been left to the work of nature alone.
I stated a moment ago that Kamouraska was both a farming and a lumbering district. A glance at the statistics concerning my constituency reveals that 76 per cent of the area is covered with forests. Since the production of pulpwood in the province of Quebec increased from 2,119,183 tons in 1939 to 3,902,072 tons in 1948, according to "Canada 1950," page 142, it is high time to inform farmers or owners of forest land that they should adopt a suitable forestry program in order to increase the value of their property and draw a steady income.
In conclusion, Mr. Speaker, I express the wish that in this holy year the peoples of the world will trust in God, the true King of the universe, to spare us, who still have fresh in our minds a war which is barely over, the horrors of a new conflict that might be more destructive than the two previous ones.


Mr. Henri Courtemanche (Labelle):: Mr. Speaker, in accordance with the custom which exists in the house, may I first congratulate the mover (Mr. McMillan) and the seconder (Mr. Breton) of the address in reply to the speech from the throne on the ease and clarity with which they dealt with their subject matter.
I also wish to congratulate the newly appointed parliamentary assistants. I am delighted that their talent has been recognized and that they now have the opportunity to turn it to account.
I had not intended to speak on the address in reply to the speech from the throne and I have no wish to spin out the discussion any longer than necessary but, because of the principle that is at stake, it is my duty to protest against the decision taken this afternoon by the Minister of Citizenship and Immigration, who has decided to deport Count Jacques de Bernonville to France.
In defiance of every custom and of the right of sanctuary recognized for centuries, we have just turned over to his communist enemies a man who has been accused of certain crimes, none of which have ever been proved, and who, in my opinion, is guilty only of being a Frenchman and a practising Roman Catholic.
There are other Frenchmen who sought asylum in this country at the same time as

Count Jacques de Bernonville. And yet they have never been the subject of discussion. We hear about other immigrants to whom permission has been granted to remain in Canada even though they entered the country under false passports. Why make it a crime for de Bernonville to have sought refuge in Quebec when not a single voice has been heard in that province to demand his deportation? Could it be that Quebec is not allowed the right to choose the type of immigrants she wants? We, in Quebec, know that the crimes of which Jacques de Bernonville stands charged are pure fabrications, the work of communists or fellow-travellers who have sworn to get him.
The communists know that the Catholic church is their implacable enemy and the violent struggle they are waging against the church in Hungary and Czechoslovakia is evidence enough.
We know that Count de Bernonville was convicted in absentia by a communist government in Toulouse, France, but we also know who de Bernonville is.
At the age of twenty he was created a knight of the Legion of Honour in recognition of his gallantry in the field. At twenty-three he became an officer of the Legion of Honour. He is the holder of several citations and was awarded the Croix de Guerre in 1918. He has been wounded several times; the soars of thirty wounds are proof of that. He was mentioned in dispatches and was awarded the Croix de Guerre in 1940. That citation was published in the French Journal officiel.
Those are the crimes on which the communist element of this country has based itself to force from the Minister of Citizenship and Immigration a decision he has been refusing for two years.
While testifying in his own defence before the courts in Montreal, in 1948, Count Jacques de Bernonville made a declaration under oath. It has never been denied and no one has been able to contradict that statement.
Far from having caused Canadians to be massacred, as is stated in the indictment preferred against him, he was, on the contrary, instrumental in helping Canadian prisoners of war to escape. Such was the evidence given by Captain Masson during the hearing of the Jacques de Bernonville case in Montreal. And, on February 24,	1949, Mr. Frederic Dorion informed the house of this statement.
In view of the political persecution to which Jacques de Bernonville was subjected, he had the right to seek and secure asylum in another country. This asylum he sought in French 80709-15
The Address-Mr. Courtemanche Canada. Will Canada refuse to harbour this Frenchman who pays us the tribute of believing in Canadian liberty?
The laws of hospitality, the requirements of humanitarianism and those feelings which should come naturally to hearts still moved by appeals to compassion and honour, demand that political refugees should not be extradited. Modern Canada, more backward than eighteenth-century England,, has just given in to bloodthirsty wolves who are after the head of this man whose only fault was to believe in a hospitality he is so shamefully refused.	-
History will pass a severe judgment upon those who were accessories to this deed. I dare hope that no Canadian will ever undergo such heart-rending tribulations as those which my country has deliberately inflicted upon a hero who could have expected more kindness from French Canada.
(Text):


Mr. W. J. Henderson (Kingston City):: Mr. Speaker, it is a great honour for me to say a few words in this debate this evening. First, I wish to congratulate the mover (Mr. McMillan) and seconder (Mr. Breton) of the address in reply to the speech from the throne. In particular, I should like to say a few words about the mover. He is a graduate of Queen's university. I am pleased to see him here, and I hope that he will attain the height and the prestige in this house enjoyed by a former graduate of Queen's, the hon. Minister of National Revenue (Mr. McCann). It was an honour for me to accompany the member for Greenwood (Mr. Macdonnell) this fall to a special convocation at Queen's, and there to see an honorary degree conferred upon the Minister of National Revenue. I am sure that the university conferred this degree not only in recognition of his work as a minister in this house, but in recognition of his manner of assistance to others, of his services as a medical doctor in his community, and as a statesman of renown.
Tonight I wish to say a few words on a matter of less importance than the national emergency, but of importance to the preservation of the rights and independence of our citizens. I am pleased to see mention made in the speech from the throne of consideration of a measure respecting the abolition of the requirement of a fiat in cases of petition of right. I am sure that many of the members of the legal profession in Canada believe the time is long overdue for a complete reexamination of the crown's position in litigation, and also the special procedural immunities of the crown which should be regulated, cut down and possibly abolished.

The Address-Mr. Henderson
It is my personal feeling, and I am sure it is the feeling in the constituency of Kingston City, that there is an extremely urgent need for the St. Lawrence seaway and power project in relation to the security and development of this continent. It is apparent that any step which this house can take whereby the government can promptly and effectively co-operate with the United States in initiating this construction would be welcome.
In the many speeches in this house members have dealt with the armed forces in terms of dollars and numbers, and have made other references to the armed forces of Canada. For a few moments I should like to deal briefly with the reserve forces from my own practical, personal knowledge both of the district which I represent, and from the point of view of the three services in that area. In my reference to these forces I shall not deal with numbers and dollars, but I shall deal with them in such a way that we can see what is actually being done. It is my belief that the reserve forces are playing an important role, and have developed to the point where they could become a trained nucleus of active forces if called upon. Their commanders, officers, N.C.O.'s and men are exceedingly well trained. For the most part, they are men who have won their spurs in Dieppe, Italy, and the attack on D-day. They are young men still, and will be able to pass on the lessons of their experience to the younger men, N.C.O.'s and recruits. I believe that this is being done.
Speaking of the reserve army training at Petawawa this past summer under General Vokes, it was remarkable to see how the commanders, officers, and N.C.O.'s fitted into their roles as in real battle. At this particular period of training new equipment and improved equipment was available for inspection and use. I might say that this was particularly true with respect to the Royal Canadian Corps of Signals. This unit, as you know, has it headquarters at Vimy barracks outside of Kingston. This summer the unit had a divisional signals set-up and was demonstrating the equipment and lessons which had been learned on Exercise Sweetbriar. At first we may not think it important, but they went so far as to demonstrate how they properly winterproofed their vehicles, and their special type of stove in the wireless van so that the operators could be warm and able to function efficiently. These displays and schemes, I suggest, cannot be disregarded. Training of this nature provides an opportunity for the active force to bring the reserve force up to date.
I am pleased that in Kingston and district there is a great feeling of comradeship

amongst the R.C.A.F. veterans in their forming of the No. 416 wing, R.C.A.F. association. There are virtually hundreds of members, and they are associating themselves with the local air force cadet corps, No. 58 squads ron. It is my belief, in common with the member for Vancouver-Burrard (Mr. Mae-Dougall), that the greatest attention should be paid to the training of boys of high school age. They will be the pilots, gunners and navigators of tomorrow.
Turning to another branch of the service, may I say that the other night it was my privilege to pay a casual visit to H.M.C.S. Cataraqui, the reserve naval training ship at Kingston. It is under the able command of Commander Coleman. There I observed the training of sixty to seventy officers and cadets from Queen's university. This particular night was one of the nights of the week set aside for the university students, while the local corps is trained on the remaining nights. These officers and cadets were being directed in naval terms on the deck by officers who had gained their experience from active duty or in summer cruises, naval war games and manoeuvres. I might say that the instructors varied from highly technical instructors to those whom we called "frogmen". At one time the men were receiving instruction in close-armed combat, and at another they were receiving instruction in the operation of radar. I believe it is important for us to realize what these reserve units are doing today, and how fit these men will be if they are called upon to take their places in active duty. These officers and men would be available to assist in manning Canada's one hundred new naval vessels which were mentioned on Monday by the Minister of National Defence (Mr. Claxton). After observing them train and knowing that they are aggressive and ambitious, I am sure that they will give a good account of themselves. I understand that similar training is universally available to naval reserve units. Those responsible for training of this nature are to be complimented. I am sure it is not a waste of the taxpayers' money.
I should like to discuss briefly our present war effort which results from world conditions. We have listened to the statement by the Minister of National Defence. We have all concerned ourselves with and have read a great deal about the modern machines of war. I am sure that it must strike us that the inventive power of the scientists in the world today is the greatest in history. If we are to win this war against communism, I am sure that one of our most important aids will be the use of these modern machines of war. It must seem to the people that the

The Address-Mr. Henderson
government was wise in not wasting the taxpayers' money on equipment which would now be obsolete, and which would not be in accord with that of our neighbour to the south. Now, through government planning and the purchase of modern equipment, we will avoid waste, and be one more spoke in the wheel in assuring the North Atlantic charter nations of victory with the least possible loss of life in the' event of total war, and at the same time provide a great threat of strength to an aggressor. I am quite sure that those who have read the papers of recent date and have seen the pictures of the explosion of the new bombs will agree that they will be a deterrent factor to any aggressor.
As the subject of the exchange system of the training of officers has been mentioned in this house, I might say that it has been my privilege in my constituency in the outskirts of which is located the Royal Military College, as well as the defence college, the staff college, the signal corps, the R.C.E.M.E. corps and other units, to observe officers from all nations on friendly terms with us, who come to those schools and associate with our Canadian officers. By that association I am sure there is not only the exchange of good will and friendship but the fostering of
better relations between nations in that we are bringing together our armies of the North Atlantic charter nations and moulding them into one, with the same idea. On the streets of our city you will see officers with uniforms quite different from our own going about observing our Canadian way of life and at the same time taking their training with our officers in Canada. There are some from India, some from France and others from Italy. They have dione the clubs and citizens of Kingston the honour of appearing before them and giving speeches about their homelands. Through the facilities provided by the Department of National Defence in this country and the exchange system as outlined by the Minister of National Defence (Mr. Claxton), I feel that we now have a great and strong link with other nations, and I am sure that our nation is the better for it.
In conclusion, may I say it is my belief that we are wise in following a plan such as that outlined by the government, of not losing a war before we have a battle.
On motion of Mrs. Fairclough the debate was adjourned.
On motion of Mr. Fournier (Hull) the house adjourned at 10.55 p.m.
80709-15J

Friday, February 9, 1951